financing technical and vocational education: modalities and experiences · financing technical and...

Projet international pour l'enseignement technique et professionnelInternational Project on Technical and Vocational Education

Financing Technical and Vocational Education:Modalities and Experiences

This document was prepared by UNESCOin co-operation with the

Industrial Occupations Promotion Centreof the German Foundation for International Development

The International Project on Technical and Vocational Education (UNEVOC) is a project of the United Nations Educa-tional, Scientific and Cultural Organization (UNESCO). Its purpose is to contribute to the development and improvement oftechnical and vocational education in Member States.

UNEVOC works in three programme areas:• Programme Area A deals with the international exchange of experience and the promotion of studies on policy issues.

It is devoted to system development in technical and vocational education.• Programme Area B is devoted to strengthening national research and development capabilities, that is to the develop-

ment of infrastructures.• Programme Area C concerns access to data bases and documentation, and strengthening of the UNEVOC network, in

other words, with information and communication.

Under Programme Area C, one of the UNEVOC activities is to identify studies and documents, to publish them and todisseminate them to educational administrators, teacher educators, curriculum developers and other interested parties.It is in this context that the present study has been published to make the experiences and findings widely available to all thoseconcerned.

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The International Institute for Educational Planning (IIEP) was established in Paris by UNESCO in 1963 to serve as aworld centre for advanced training and research in educational planning. Its purpose is to help all member states of UNESCOin their social and economic development efforts, by enlarging the fund of knowledge about educational planning and thesupply of competent experts in this field.

Legally, and administratively a part of UNESCO, the Institute enjoys intellectual autonomy, and its policies and programmeare controlled by its own Governing Board, under special statutes voted by the General Conference of UNESCO.

More information about IIEP activities can be obtained from:IIEP • 7-9 rue Eugène-Delacroix • 75116 Paris • France.

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The German Foundation for International Development (DSE) is an institution which provides a forum for dialogue ondevelopment policy and the initial and advanced training of specialists and executive personnel from developing andtransitional countries. The institutional donor is the German Federal Ministry for Economic Co-operation and Development(BMZ). Since 1960, the DSE has given advanced professional training to more than 100 000 decision makers, specialists andexecutive personnel from more than 140 countries.

The Industrial Occupations Promotion Centre (ZGB) of the DSE offers advanced training in the field of vocational training.The 26 programmes aim to• give more people in the developing countries access to vocational training opportunities,• improve the efficiency of vocational training in the developing countries,• support the introduction and further development of in-plant forms of vocational training in the sectors of industry, crafts

and services,• promote co-operation between school and in-plant vocational training agencies (dual approach),• make it easier for target groups on the brink of poverty in the informal sector to set up their own business by undergoing

crafts-oriented basic vocational training,• support the processes of reform in the countries of Eastern Europe by promoting vocational training. More information can be obtained from:German Foundation for International Development • Industrial Occupations Promotion Centre •Käthe-Kollwitz-Str. 15 • D-68169 Mannheim • Germany • � [+49] (621) 3902-132

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This document was prepared by UNESCO's UNEVOC Implementation Unit in BerlinMailing address: UNESCO-UNEVOC • Fehrbelliner Platz 3 • 10707 Berlin • Germany� [+49] (30) 86 49 15 41 • Electronic Mail: [email protected] or [email protected]

WorldWideWeb: http://www.unevoc.de

© UNESCO 1996

Document Nr ED/IUG/006

Financing Technical and Vocational Education: Modalities and Experiences Page 1

Table of Contents

Introduction ...................................................................................................................................3

Financing Vocational Education and Training in Developing Countriesby Pradeep BOLINA ....................................................................................................................5

1 Preface.................................................................................................................................................. 52 Introduction......................................................................................................................................... 53 Public financing................................................................................................................................... 7

3.1 Tax revenue...................................................................................................................................................83.2 Advantages and disadvantages......................................................................................................................93.3 Policy Implications .......................................................................................................................................9

4 Enterprise financing ......................................................................................................................... 104.1 Single employer financing ..........................................................................................................................104.2 Payroll tax ...................................................................................................................................................114.3 Tax rebates and credit schemes ..................................................................................................................124.4 Ways in which tax is used...........................................................................................................................124.5 Vocational training funds............................................................................................................................134.6 Advantages and disadvantages....................................................................................................................134.7 Policy implications......................................................................................................................................15

5 Private and public sponsored financing.......................................................................................... 155.1 Training fees ...............................................................................................................................................155.2 Fellowship, grants and loans.......................................................................................................................155.3 Sale of training / non training services .......................................................................................................165.4 Co-financing agreements ............................................................................................................................165.5 The German Dual System...........................................................................................................................165.6 Production for profit ...................................................................................................................................175.7 Apprenticeship ............................................................................................................................................185.8 Paid educational leave ................................................................................................................................185.9 Non-governmental and voluntary organizations.........................................................................................185.10 Advantages and disadvantages..................................................................................................................185.11 Policy implications....................................................................................................................................20

6 International donor assistance......................................................................................................... 206.1 Advantages and disadvantages....................................................................................................................216.2 Policy implications......................................................................................................................................21

7 Conclusion ......................................................................................................................................... 22References............................................................................................................................................. 24

Financing Vocational Education: Concepts, Examples and Tendenciesby David ATCHOARENA...........................................................................................................27

1 Introduction....................................................................................................................................... 272 Issues and policies ............................................................................................................................. 28

2.1 The emergence of new principles of government intervention: Cost sharing and subsidiarity.................282.2 Apprenticeship: Sharing training responsibilities and costs......................................................................292.3 The consumer rationale: Privately financed institutional training.............................................................292.4 The use of earmarked taxation to finance training .....................................................................................302.5 From financing to regulation: Training funds............................................................................................31

3 A brief review of experience............................................................................................................. 323.1 Back to the roots: Brazil ............................................................................................................................323.2 Financing training in a context of rapid growth: Examples from Asia and the Indian Ocean ..................353.3 An African experience: Côte d'Ivoire ........................................................................................................40

4 Conclusions and further thoughts................................................................................................... 434.1 The rationale in brief ..................................................................................................................................434.2 Major trends................................................................................................................................................434.3 Variables affecting funding scheme options...............................................................................................454.4 Issues for debate..........................................................................................................................................47

References............................................................................................................................................. 49

Table: Public Expenditure on Education.................................................................................51

Annex: List of UNEVOC Publications..................................................................................................... 53

Financing Technical and Vocational Education: Modalities and Experiences

Financing Technical and Vocational Education: Modalities and Experiences Page 3

IntroductionTechnical and vocational education, according to UNESCO’s Convention on Technical and VocationalEducation,

"... refers to all forms and levels of the education process involving, in addition togeneral knowledge, the study of technologies and related sciences and the acquisition ofpractical skills, know-how, attitudes and understanding relating to occupations in thevarious sectors of economic and social life".

It can be provided

"... in educational institutions or through co-operative programmes organised jointly byeducational institutions, on the one hand, and industrial, agricultural, commercial or anyother undertaking related to the world of work, on the other"

Thus, technical and vocational education occurs in a large variety of structures and under variousresponsibilities, both in the public and in the private sector. As far as its financing is concerned,additional factors related to the socio-economic, political and administrative situations prevailing inrespective countries, have to be taken into account.

This partially explains why UNESCO’s Convention on Technical and Vocational Education, whichcovers extensive areas of technical and vocational education, such as, its objectives and principles, itscontents, its structures, its development, its teaching staff, and its international co-operation, does noteven touch upon the issue of financing technical and vocational education.

Financing, however, is as crucial an issue to technical and vocational education, as technical andvocational education itself is to human resources development in any country, no matter at what stage ofdevelopment.

UNESCO can hardly supply its Member States with prescriptions for the financing of their individualsystems of technical and vocational education. It can, however, explain various options and modalities,and disseminate experiences in this area that have been gathered from existing systems. It is to this endthat UNESCO is disseminating the present documents. The first contribution, by Ms Pradeep BOLINA,provides a systematic overview of various modalities of public and private finance of technical andvocational education.1 The second contribution, by Mr David ATCHOARENA, draws conclusions fromexperience with various existing concepts of financing.

This document has been prepared by UNEVOC Berlin in co-operation with the German Foundation forInternational Development (DSE) and UNESCO's International Institute for Educational Planning(IIEP).

It is hoped that it will stimulate the debate in Member States, and contribute to new and creativesolutions to the pressing need for the effective financing of technical and vocational education.

Hans KrönnerChief, UNEVOC BerlinUNESCO

1 Ms Bolina's contribution had previously been published by the German Foundation for International Development (DSE). Her text has

been slightly edited; the table on page 51 has been updated in the light of recent data from the UNESCO Statistical Yearbook

Financing Technical and Vocational Education: Modalities and Experiences

BOLINA: Financing Vocational Education and Training in Developing Countries Page 5

Financing Vocational Education and Training in Developing Countriesby Pradeep BOLINA

Ms Pradeep BOLINA is Deputy Secretary in the Departmentof Economic Affairs of the Ministry of Finance. Before, sheserved at the Ministry of Human Resource Development.She has been a participant in the programme "Planning ofVocational Training Systems" of the German Foundation forInternational Development (DSE).

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1 PrefaceThis paper has been developed for the use of theparticipants of vocational training courses con-ducted by the Industrial Occupations PromotionCentre of the German Foundation for InternationalDevelopment in Mannheim. The participants,mainly in-service personnel, come from more than100 countries representing vocational trainingcentres, Ministries of Education and Labour andNon-Government Organisations. As the partici-pants are involved at different levels in the plan-ning and implementation of vocational educationand training in their respective countries, the mainaim of this paper is to create in them adequateawareness of how vocational education and train-ing systems are financed. The manual is a simplereadable document which could be of use to par-ticipants with varying levels of education.

In its preparation the Paper leans heavily on theworks of Dennis Herschbach and Maria Ducci anddraws upon the ideas and country experiencescontained in books and articles on the subjectwritten by other eminent educators and trainers.

This paper has been prepared under the generalguidance of Mr H. Burk, Director of the IndustrialOccupations Promotion Centre, and Dr M.Wallenborn.

2 IntroductionIn almost all the countries in the world educationis provided in both the public and the privatesectors. A certain minimum level of education is

2 This text is a slightly modified version of: Problems of

Financing Vocational Education and Training in DevelopingCountries, Training and Discussion Papers, published by theGerman Foundation for International Development (DSE),Industrial Occupations Promotion Centre, ISBN 3-924441-76-6, Mannheim 1994

necessary for a country to achieve economicgrowth. The allocation of resources to educationvaries in each country in accordance with itspriorities but generally ranges from 3 to 8 % of thegross national product (GNP) (UNESCO, 1993).

The overall costs on education are on the increase.Developing countries are particularly hard hit dueto the economic crisis. They need to improve pro-ductivity to enable them to compete in an era ofrapid economic and technological change. Thisrequires both capital investment and a workforcewith the flexibility for acquiring new skills fornew jobs. They are also faced with the challengeof meeting the requirements of the educationsector, to fulfil the overall responsibility vested inthe state for development of human resources.Governments cannot shift this responsibility aseducation confers benefits to the society at large.It can at best harness the support of the privatesector, the community and individuals in itsendeavour to reach its goals towards social andeconomic development of the country. Whilebudgetary constraints are prevailing everywhere itis more severe in countries which have completelypublic financed education systems. Some of thereasons for the crisis in financing education areincrease in demand for access to education,increase in teachers' salaries, inefficiency in theuse of available resources, demographic growthcreating additional demand for schooling facilities,unemployment of graduates, increase in the costsof land and buildings etc. Reform in financing hasto come about by modifying financing modes.Some ways could be, that users should bear somepart of the costs as entire public funding cannot bejustified; more efficient management of funds,search for private financing, community andenterprise involvement, foreign aid.

As budget allocations from government sourcesfor education get tighter, the squeeze on avail-ability of funds for Vocational Education andTraining (VET) is apparent in so far as VET isdependent on public funds. Costs on VET as com-pared with general education are also 2 to 3 times

BOLINA: Financing Vocational Education and Training in Developing Countries

higher as classes are small with instructor traineeratios of 1:7 sometimes. This increases the unitteaching costs. Expenditure on equipment, infra-structure, consumables e.g. raw materials andspare parts is also much higher. It is then impera-tive to search for alternative means of financing.The challenge before policy makers is to introducenew and different ways of financing as well as toensure that the resources which are available forVET are used more effectively.

Traditionally VET was provided by employerswho paid lower wages and sometimes apprenticeshad to pay the employer. This was prevalent inmany different countries. In Germany, approxi-mately since the 12th century, a person wasallowed to pursue a trade independently if he hadfinished the apprenticeship in a craft with amaster. After apprenticeship he had to obtain pro-fessional experience as a journeyman. The mastertaught his apprentice and journeyman the knowl-edge of his trade. The craftsmen got united andformed guilds (craftsmen's organisations) andevolved a proper training system. The mainresponsibility for vocational training lay with thecraftsmen's organisations and all conditions wereregulated by the guild.

Traditional apprenticeship also existed in India forcenturies. Even today in towns and villages it is avery common sight to observe an apprenticeworking with the master, learning by working onthe job, all at a very early age. In the former timesin India apprentices often lived with the masterand there was a certain unity in living, learningand working. In the small by lanes of towns andcities in countries like Indonesia, Nepal, Bangla-desh and India it is very common to see youngapprentices in the age group of 10-20 years beingtrained by their employers e.g. the bicycle repair,

Abbreviations:

CONET National Council for Technical Education, ArgentinaINACAP National Institute for Training, ChileNGO Non-Government OrganisationOTE Technical Execution Organisation, ChileSENA National Training Service, ColombiaSENAEM National Employment Secretariat, ChileSENAI National Service for Industrial Training, BrazilSENATI National Service for Apprenticeships and Industrial

Employment, PeruSENCE National Service for Training and Employment; ChileVET Vocational Education and TrainingVTI Vocational Training Institute

the auto mechanics workshop. They go straight'on the job'. Sometimes in the initial stages thereis no payment. As they learn the work they beginto get a small wage. The costs are shared by theemployer who provides the training and theworker who accepts low wages.

In the modern times the scenario has somewhatchanged. Gradually governments have becomemore involved in VET especially in the last twodecades. This is mainly to link vocational edu-cation and training with the social, economic andemployment policies of the country. Publicrevenue for VET has assumed more importance.But owing to the economic crisis governments hadto reduce the public budgets for education and thishas a direct bearing on all sectors of educationincluding VET. Serious attempts have to be madeto find resources to supplement available funds.Every country has to assess its training needs andrequirements in accordance with its goals andpriorities and the prevailing socio-economic con-ditions. Thereafter strategies for financing VEThave to be worked out and additional resourcesgenerated.

While governments are searching for new andalternative mechanisms, the private sector is beingdrawn in justifiably, for those who benefit mustpay for it. The relevance of vocational educationto the labour market requirements is crucial. Asthe employers become more involved in the actualprovision of vocational education and training itwill come closer to labour market needs influ-enced particularly by the rapid technologicalchange.

Skill requirements have also become more com-plex. Vocational Training Institutes are set upwith new and modern training methods beingoffered. This has naturally led to questions beingraised about the costs of training and the mecha-nisms of financing it. It is difficult to estimate theexact costs on VET due to the complexitiesinvolved in the training systems, the absence ofaccurate accounts by employers and the productivework of the apprentices/trainees who accept lowerwages and thereby offset part of the costs incurred.Nevertheless studies have concentrated on the totalamount of funds allocated for VET and its ade-quacy. Mincer conducted a study as early as in


1958 on the costs of industrial training in USA.He estimated that the total opportunity cost offormal and informal vocational training was overUS$ 16 billion in 1958 of which US$ 10 billionwas the cost of training in private firms or corpo-rate enterprises. 70 % of this was spent on infor-mal 'on the job' training and 30 % on formaltraining (Mincer 1962). The costs on VET in theUK were also estimated, which put the total costsof education at £ 9.000 million per annum in GreatBritain. Roughly the estimates out of this on VETwould account for £ 3.000 million a year (Johnson1979).

Even though the studies mentioned above showthat a large volume of resources was used for VETin these countries, in many countries it is beingconsistently felt that not enough resources areprovided for VET. This is particularly the case indeveloping countries which are experiencing ashortage of skilled manpower. Governments aretherefore getting more concerned about financingof vocational training to meet the new andemerging labour market requirements.

Various financing strategies are practised in dif-ferent parts of the world. Some of the more wellknown mechanisms for financing VET have beencategorised in the following four types:1. Public Financing2. Enterprise Financing3. Private and Public Sponsored Financing4. International Donor Assistance.

In the following pages the four types of financingmechanisms have been described briefly withsome country examples. The advantages and dis-advantages of each type have also been identifiedand policy implications indicated.

3 Public financingTraditionally vocational training was provided byemployers who paid lower wages or no wages atall to the trainees. Employers did this if itincreased productivity of workers. In many cases,government was only involved with standards oftraining.

Involvement of governments increased mainly tolink vocational education and training moreclosely with social, economic and employment

policies of the country. There was also a growingconcern about distribution of training opportuni-ties for the poorer and disadvantaged sections ofthe society.

Public Financing is provided through publicrevenue (government funds). When the Statefinances vocational training through public fundsit is on the assumption that the ultimate responsi-bility for development of human resources fornational development lies with the State.

Governments also intervene in the provision ofvocational training to ensure social equity for thepoor in the rural and urban informal sector. Publicfinanced VET provides opportunities to personswho may otherwise have limited chances e.g.those from the deprived sections of the society.

In most countries the budget for VET from publicsources is relatively small, ranging from 1 to 12 %of the current expenditure on education(UNESCO, 1993). A table indicating the totaleducational expenditure as percentage of GNP andthe vocational expenditure as percentage of publiccurrent expenditure on education for some coun-tries in each continent may be seen on page 51.The table shows the priority of governments tovocational education in budget allocations frompublic expenditure. A comparison can also bemade of the provisions for education and particu-larly for vocational education in the developedcountries vis-à-vis the developing countries.

Mostly public financed vocational training pro-grammes are implemented in schools beforeemployment is taken up. Non-formal trainingcentres, pre-service and in-service training forMinistries also receive public funding.

Specialised vocational training institutions receivepublic funds mainly through subsidies, budgetappropriations, tax incentives, financing of specialprogrammes with special grants, financing ofdevelopment projects, financing of supervisorybodies, fellowships for VET. In developing coun-tries e.g. Pakistan, India and Thailand the mainfinancial contribution for VET comes from publicfunds (government). Industry takes little part incontributing to vocational training institutes.


In cases of mixed funding, generally capitalexpenditure is provided by the governments andrecurring expenditure is shared through othersources.

Public vocational training institutions generallyoffer courses which provide basic skills necessaryin pre-service training. In Canada, manpowertraining programmes are offered in public institu-tions e.g. in colleges and vocational trainingcentres.

3.1 Tax revenueThe major source of public funds is through taxrevenue. Sometimes governments give grants tovocational training institutions which can raisesome resources on its own. Such a grant is calledmatching grant as it makes it obligatory for thepotential recipient to first raise some finances onits own. In USA, the Federal Government makesuse of financing through matching grants and cate-gorical aid. It gives about 6-8 % of the State andlocal contributions for public supported VET(Herschbach, 1993).

Categorical aid is given for a specific purpose tomeet the special needs of certain target groups.It supplements funds which are provided forgeneral purpose VET.

In many countries owing to a shortage of skilledmanpower governments had to create propervocational training systems for long term socialreturns of training, need for equal opportunities oftraining for those who are unable to pay costs oftheir training, and to promote national VET poli-cies. Training institutions thus created weremainly financed by a general tax through com-pulsory contributions made by firms and enter-prises, contributions from national treasury,co-financing agreements and sale of trainingservices (Ducci, 1991).

When governments finance vocational traininginstitutions they control the volume of resourcesallocated to VET in accordance with the prioritiesof the social and economic sectors (Ducci, 1991).They are also able to exercise control on thequality of the programmes.

The cost effectiveness of vocational trainingthrough public financing is said to be low aspublic training institutions are not very keen toevaluate the qualitative and quantitative trainingneeds. In Argentina, CONET receives fundingfrom the Ministry which has been declining overthe years due to a reduction in the overall budgetof the ministry. There are restrictions on CONETsecuring funds from other sources e.g. sale ofservices, international sources and this has led to aserious shortage of resources affecting the effi-ciency of the institution in maintenance of infra-structure and equipment and reduction in staffsalaries (Ducci, 1991).

When public training institutions are expandedand do not get adequate finances correspondinglythe quality of training may become poor. In Egyptgovernment enrols more than half of upper secon-dary students in vocational schools to divert themfrom higher education. Open unemploymentamong graduates exceeds 35 %. In Bangladesh,Cameroon less than half of public trainees findwage employment in their trade. Public traininghas to respond to the demand in the labour market,only then can it become cost effective with goodquality training leading to high placement rates(World Bank, 1991).

Public contributions are controlled by restrictivepolicies. Vocational training institutions whichare dependent solely on public funds have thechance of becoming stagnant with a deteriorationin their planning and efficiency. Sometimessubsidies to vocational training institutions aredependent on the good will of the government.

Many developing countries have highly centralisedsystems and major control is with the centralgovernment. When VET is financed through theState it controls the curriculum, certification,qualification of teachers (World Bank, 1988). Indecentralised systems there is a sharing of power.A healthy policy is to allow communities andlower levels of government to have greaterautonomy.

There should also be a balance between theresources controlled by the central governmentand those available to the lower levels of govern-ment.


3.2 Advantages and disadvantages

Advantages• When government finances vocational training

through public revenue it can co-ordinate therequirements in accordance with the demandprojected in the economic and employmentpolicies.

• Matching grants encourage local initiative asinstitutions wishing to receive grants from thegovernment try to raise resources on their own.

• Categorial aid usually helps to implementchange as it is given for a specific purpose or tomeet the needs of specific target groups in thepopulation.

• Through both these methods of financing,governments can share control and at the sametime have part of the financial burden shared byothers.

• In the initial stages, national training centres aresaid to develop better in centralised systems asthe institutional capacities are not strong. Butcentralisation is not desirable when institutionsbecome well developed. At that stage moreautonomy is required.

• In public distribution systems there is moreequity. Publicly financed vocational trainingsystems offer opportunities to the poorersections of the society. For them it may be theonly opportunity to become trained.

Disadvantages• Underfinancing. Shortage of resources for VET

from public educational funds.• Sometimes governments are under pressure to

open more VET institutions even whenresources are inadequate. This leads to imple-mentation of programmes which are under-financed and the quality of training may decline.

• Unreliable support. There are variations in theallocation of educational budgets. Fundingfluctuates and VET programmes get affected.

• Sometimes new programmes receive substantialsupport. But priorities may change on accountof political considerations.

• Unbalanced allocation of resources. Sometimesthere is a larger investment in capital costs andnot enough provision for recurrent expenses.Low salaries of teachers is found to adverselyaffect the quality of instruction and conse-quently student achievement may become low.

• In centralised systems there are high adminis-trative costs, lack of flexibility and unrespon-siveness to labour force requirements.

• The cost effectiveness of vocational trainingthrough public financing is found to be low inmany countries as public training institutions arenot very keen to evaluate the qualitative andquantitative training needs (Ducci, 1991).

• Rigidly prepared curricula in public institutionsprevents them from responding to locallyidentified training needs.

• Public institutions are less able than privateinstitutions to adjust training for the labourmarket in accordance with the rapidly changingtechnology.

3.3 Policy ImplicationsTo be successful public training should concen-trate on choosing appropriate objectives, improv-ing market orientation and matching policies inaccordance with labour market needs, usingresources efficiently and diversifying sources offinance.

Public supported vocational training systemsshould be able to receive funding from local taxes,user fees and collaborative arrangements.

When Public Financing is the sole source ofsupport to VET, institutions may face fluctuationsin budget allocations. This can cause shortage ofresources which may lead to low quality pro-grammes with limited returns on investment.

In countries where the quality of vocational pro-grammes is poor in public funded institutions,these programmes should be removed and avail-able resources reallocated (Herschbach, 1993).

VET systems can be strengthened with comple-mentary public funds from other sources and thiscan be done through programme reduction andresource reallocation.

Stability in provision of training facilities cancome from long term financial support. Govern-ments should adopt consistent policies required forremoving inefficiencies.

Decentralisation helps through delegation ofauthority to lower levels. Training institutions


with a board of representatives of employers,workers organisations and the government havebetter chances to discuss and adopt relevant andcost effective strategies for training.

4 Enterprise financingThe enterprise/company conducts the vocationaltraining of its labour force directly and bears theentire costs of training.

Often enterprises finance a major part of thetraining but actual training occurs in specialisedvocational training institutions.

Sometimes enterprises contribute a small amountof money to a central vocational training fund astaxes and these resources are used in differentways to finance training.

4.1 Single employer financing

JapanJapan is well known for its vocational trainingorganised within large private companies.Employers prefer to recruit fresh school leaverswith general education and then provide them withcontinuous training within the enterprise.

The public sector is generally small. In 1980's itemployed 3.6 % of the labour force (Inoue, 1985).Private industry employs 85 % of the labour forceand is dominated mainly by large industrialcompanies.

Japanese people have a strong influence of culturederived from Buddhism, Confucianism andShintoism which teaches them to achieve highstandards through hard work and have lastingobligations to the school group, the family and thecompany (Lauglo, 1993).

Generally a person devotes his whole life toworking in the same company. Most Japanesecompanies also recruit a workforce for life.Training is given on the assumption that employ-ees will continue to work for the same company.In large companies which employ 30 % of thelabour force employment for life is an importantnorm (McCormick, 1989).

Most large companies organise their own voca-tional training and the outlays for in-house voca-

tional training are considered a part of the labourcosts. Smaller companies with less resources relyon training facilities outside the company and aresupported financially from proceeds of the unem-ployment insurance funds to which the govern-ment and employers contribute half and half.Enterprises can also pay to get membership ofoutside training organisations and can thus usetheir facilities for training of trainers.

Vocational training is also organised outside thecompanies in special vocational schools run byvarious Ministries. Private vocational schoolsoffer courses of varying duration including dayand evening courses. These schools get grantsfrom the government if they are not run for profit.

Most technical training in companies takes placein close connection with production. Productionengineers train a small group of workers who willuse the latest technology and in turn these workerswill further teach others in their work groupswhich are established for production purposes. Assuch the extra resources provided for training aresometimes much less than the training thatactually takes place (McCormick, 1989).

Technical training also takes place through selfstudy of manuals or through correspondencecourses. These costs also do not fall on theemployers. According to Dore and Sako (1987) ifhourly wages were to be calculated for this contri-bution the total may exceed the training costsincurred by the industry. Sometimes companiesalso provide finances for self development ofworkers. Employees are highly motivated toupgrade their skills.

The government helps to finance and guide voca-tional training among small firms. But majorcompanies do not rely on training done in govern-ment institutions. They also believe that employeetraining should be tailored to the requirements andconditions of each company (Pedder, 1989).

The Japan Industrial and Vocational TrainingAssociation (JIVTA) is the main organisation inJapan concerned with training within industry.It is a private association of employers and has aconstitution and a budget supervised by theMinistry of International Trade and Industry.


JIVTA policy is developed by 1.000 companyrepresentatives of which 60 % are from largecompanies and 40 % from small companies. Thegovernment does not provide funding to JIVTA.25 % of its budget is collected from membershipfees and 75 % is generated from course fees. Inthe last 30 years JIVTA trained 30,000 persons astraining leaders who in turn trained more than1,000,000 trainees in their own industries. JIVTAhas given a unique direction to the employersabout an independent approach in vocationaltraining (Pedder, 1989).

Employers consider training as an investment.They provide training in accordance with theirown needs and this has resulted in developingeffective policies.

KoreaIn Korea the Basic Law for Vocational Trainingenforced in 1976 makes it mandatory for enter-prises with over 300 employees to conduct in planttraining. If they do not do so they pay a traininglevy based on a certain percentage of payroll costsranging from 1 % to 3,9 %. Large companies havetraining budgets and consider training as an impor-tant investment. Apart from Japan, Korea is animportant example of a country in the Asianregion which is relying heavily on skills training inthe enterprise. But small companies still rely onthe public training system (Pedder, 1989).

4.2 Payroll taxIn Latin America payroll tax was generally used tosupport vocational training. In 1942, the Braziliangovernment levied a special tax on enterprises foroffering compulsory technical training to appren-tices and SENAI - the National Industrial TrainingService - was founded. Colombia establishedSENA in 1957, Venezuela the INCE in 1959 andPeru set up SENATI in 1961. There was a closecollaboration between the government, theemployers and worker groups (Ducci, 1983).

In 1987, Vocational Training Institutes (VTI) in 12Latin American countries enrolled more than 3million persons equivalent to 37 % of total secon-dary school enrolments in the same countries(CINTERFOR/ILO, 1991).

Government usually assesses an annual levy of 1to 2 % of the wage bill paid by the employers and

sometimes even 3 %. In every country there arevariations. Sometimes state enterprises andgovernment bodies do not contribute. Sometimessmaller firms are exempt and larger firms paymore. Sometimes workers also pay, but most ofthe funds come from enterprises.

The range of training services include formalapprenticeships with classroom instruction, sand-wich courses and training of instructors offered fortechnicians, supervisors and middle managers.

In UK the Industrial Training Act of 1964 aimed atincreasing the amount of training in industry,improving its quality and redistributing costs morefairly. Through the levy grant all firms con-tributed towards costs of training which rangedfrom 1 % to over 3 % of the total wages andsalaries. The system increased the quantity oftraining but the Industrial Training Boards and theIndustrial Training Act came under criticism. TheTraining Act was replaced in 1974 by a selectivelevy grant system involving exemptions to smallfirms or those which provide enough training fortheir own labour needs. Levies were not compul-sory but imposed on firms which provided notraining or limited training (Woodhall, 1987).

In France there is a compulsory tax system oftraining funds and an apprenticeship tax so that allfirms must pay a certain proportion of their totalwages and salaries as a payroll tax, and thesefunds are used for financing vocational education.

In some countries governments provide subsidiesto encourage training and the costs are met fromgeneral taxation. In Australia the CommonwealthRebate for Apprenticeship Full Time Training(CRAFT) is a subsidy used for reimbursingemployers for part of the costs of apprenticeshiptraining (Woodhall, 1987).

In some of the Latin American countries the pay-roll taxes have been criticised. In Argentina thepayroll tax was removed in 1981 as attempts weremade to restructure public expenditures to copewith the economic crisis. In Brazil, the payroll taxhas grown. But co-financing between the enter-prises and VTIs is gaining more importance. InColombia, on one side the payroll taxes have been


questioned and on the other its application hasbeen diversified (Ducci, 1991).

In Costa Rica although the payroll contributionincreased from 1 % to 2 % in 1983, the surplusmoney was transferred to another fund and usedfor purposes other than vocational training. InPeru, SENATI has lowered payroll taxes and istrying to find funding from other sources (Ducci,1991).

4.3 Tax rebates and credit schemesIn most regions other than Latin America, TaxRebates or Tax Credit system is more frequentlyused. The principle is the same as Payroll Levies -those who benefit, pay the costs of training.

In Tax Rebates, a portion of the tax is returned tothe firm as subsidy for training. In Singapore andTunisia, the rebate is on the basis of costsincurred. In Nigeria and Zimbabwe it is in theform of grants to set up training systems.

In tax credit the firm reduces its tax bill by thevalue of training.

4.4 Ways in which tax is usedIn Ivory Coast modern sector enterprises have topay 1.2 % for continuing vocational training and0.4 % for apprenticeship and initial training.Funds are managed by the Fund for Developmentof Vocational Training (FDFP) (Herschbach,1993).

In Taiwan the small and medium sized firms tooka keen interest for training in the enterprise. Firmsget up to 80 % of training costs reimbursed(Herschbach, 1993).

Tax rebates for financing vocational training wereprevalent in Argentina since 1981 and in Braziland Chile since 1976. In 1975 the BrazilianGovernment passed a law for deduction in theform of income tax of juridical persons equal totwice the expenditure invested in vocationaltraining and up to a ceiling of 10 % of taxableearnings. But after 10 years a review showed dis-couraging results. The impact was small. Therewas evidence that tax rebates were mainly beingused by those enterprises which already hadambitious training programmes (Ducci, 1991).

In Argentina tax credit system was introduced bylaw in 1980. Enterprises were authorised todeduct from their taxes up to 8 per thousand ofoverall wages and salaries as expenditure ontechnical education and training of workers.CONET is in charge of the spending and issuingof certificates when enterprises pay their dues tothe general tax department. The Argentine Con-struction Chamber set up a Vocational TrainingCentre and a support body called Caesar M.Toledo Training Centre Association. Firms whichbelong to the Chamber give their share of contri-butions to this Association which uses the fundsfor training (Ducci, 1991).

In Chile the National Training and EmploymentService (SENCE) created in 1976 is mainlyresponsible for Vocational Training. Tax incen-tives to enterprises are the main source of financ-ing. Implementing agencies conduct trainingwhich is supervised by SENCE (Ducci, 1991).

France has a very comprehensive system of financ-ing vocational training (Herschbach, 1993). Thereis a combination of public supported pre-servicetraining, enterprise supported in-service trainingand funds from the state, regional and local levelsaccount for approximately 40 % of the total annualbudget for all types of VET. The rest is financedby private enterprises.

There are 3 ways of financing in France:a) General tax revenues used for supporting public

and private secondary level pre-employmentvocational education. Outlay for VET is about1.5 % of the Gross Domestic Product (GDP).

b) Compulsory Apprenticeship Tax of about 0.6 %of a company's wage bill is used for initialtraining. Of this 0.1 % is kept by the govern-ment for training of youth between 16 - 25years of age and 0.5 % is collected and admin-istered by regional councils. If employersaccept apprentices they do not pay tax. Theycan also pay fees to the institutions thatorganise courses or they can pay taxes directlyto the government. In this way employers fulfiltheir obligations.

c) Compulsory in-service tax is applicable to allenterprises which have more than 9 employees.It is 1.2 % of each company's total wage bill.Employers can use 0.8 % of this for their own


in-house training. From the remaining amount0.3 % is used for youth training and 0.1 % fortraining employees during paid training leave.

The French Training System has a large trainingindustry and offers a variety of VET programmes.Government takes an active interest. It formulatespolicy, legal framework and monitors quality oftraining.

4.5 Vocational training fundsIn many countries where employers are activeparticipants in VET a Training Fund for financingvocational training has been set up. Tax contri-butions from the employers collected through pay-roll levies or subsidies from the government aretransferred to the Training Fund.

In Zimbabwe companies by an Act of Law have tocontribute 1 % of their wage bill to a central fundmanaged by the Ministry of Education and calledZimbabwe Manpower Development Fund(ZIMDEF). The fund is used for financing voca-tional training activities e.g. apprenticeship train-ing for various categories of trainees, upgradingtraining of skilled workers. Also companies thatprovide 'on the job' training to apprentices canclaim rebates from this fund at a prescribed rate.

Management of funds can be handled by the con-cerned Ministry, the employers association and theworkers' unions. This is a useful way as such co-operation facilitates formulation of appropriatetraining policy.

Funds can be managed in the following ways(Atchoarena, 1993):

a) The "Fair Return" system of managementEvery firm contributes to the Fund in accordancewith legal provisions. After contributing, the firmhas a right for a certain period of time, to refundan amount equivalent to its contribution and use itfor training.

b) MutualizationAccording to Atchoarena mutualization is a termused as the financial expression of the principal ofsolidarity. Under this system, the contributionsfrom the companies are managed entirely by theFund. The management of the Fund decides howmuch training is required from each firm. The

firms do not have special claims. Some of thesmall firms may get more funds than their contri-butions and others may get less. Training activi-ties are organised according to the target groupand demand for training.

c) Drawing RightsEvery firm gets a drawing right which is a fractionof its contribution. The remaining amount ismutualised. Every firm retains a certain degree ofautonomy and the Fund also has some reserves.


Advantages• When individual companies train their own

work force such as in Japan they can tailor theirrequirements in accordance with the actualneeds. This leads to effective management poli-cies and avoids wastage of trained manpower.

• When training occurs alongside production itreduces the overall costs on training.

• Training and employment in one company orenterprise gives stability to the individual and tothe company.

• A study of financing of vocational training inLatin America (Kingler & Reyes, 1978) indi-cated that payroll taxes proved to be an effectivefinancing mechanism as it helped to createtraining institutions that are workable and goodalternatives to traditional training systems.

• Payroll levies are found to be more successful inmiddle income countries. They are effective inaddressing the training needs of large formalsector enterprises. Also effective in strengthen-ing government, employers and labour co-operation (Inter-American Centre for Researchand Documentation for Vocational Training,1991).

• Payroll levies are shouldered by enterprises butpart of the costs fall on workers in the form oflower wages. This leads to sharing of costs asworkers subsidise their own training.

• Although training costs are high for the nationaltraining agencies but quality of training pro-grammes is better and linked to employersneeds.

• Larger enterprises benefit more through taxrebates and credits. In 1985, in Singapore allthe firms with 200 or more employees appliedfor training grants in contrast to 25 % of firmswith 50 employees or less. Firms which had 10


employees or less only 2.2 % applied for grants(Pang and Salome, 1986).

• Tax credits are more effective in matured ormaturing economies.

• When seen from a broader perspective VTI'scompete with each other to train manpowerrequired by the enterprises. This encouragesefficiency within the institutions.

• As the Vocational Training Fund observes thelabour market closely and has regular interactionwith business and industrial houses, it can in-fluence the organisation of appropriate VETprogrammes in accordance with labour marketdemand.

• It can also influence the quality of training.• As it negotiates funding of training with

business and industrial houses, to an extent iteffectively regulates industrial relations.

• Through the process of Mutualization the Fundcan provide resources for training to small firmsand enterprises which may not otherwise haveenough access to training. As such it can offerequal training opportunities to firms.

Disadvantages• Government officials try to regulate the inde-

pendence of individual companies and this maycreate some policy problems.

• Companies try to recruit only the best studentsas trainees. This may cause social inequity.

• When training takes place only in one companythere is absence of general certification. Thisaffects labour mobilisation from one company toanother.

• Companies may reduce training places to avoidcosts if they do not make adequate profit.

• Payroll levies are found to be less effective inaddressing the training requirement of small andmedium sized employers, women, the workersand unemployed (Ducci, 1991). In small coun-tries private sector is small, governments haveless capacity to generate income, less adminis-trative capability to collect payroll taxes and sothey have not been successful.

• Payroll levies lead to firms reducing their selffinanced training activities. Taxes, in a sensecrush the individual initiative and firms onlytrain to fulfil the legal requirements (Bas andCastro, 1989).

• Payroll levies are often criticised. Governmentsdivert some of the funds collected through levies

to finance other programmes. Sometimes only15 % is used to finance national trainingauthorities. In Colombia SENA has to give50 % of the revenues generated through payrollsto support formal public school vocational pro-grammes (Cuervo and Van Steenwyk, 1986).

• In tax rebate and credit schemes high adminis-trative costs are involved. Firms which wouldnormally invest more have a tendency to reducetheir effort to the bare minimum required bylaw. Sometimes reluctant firms organise poortraining (Bas and Castro, 1989).

• In Brazil and Chile where some evaluationswere made, tax rebates concentrated benefits onlarge enterprises in the more developed regions.Steps had to be taken to promote small andmedium sized firms and associations (Ducci,1991).

• Tax rebates ultimately imply that financing is bythe State but the training imparted is by theenterprises. Although this leads to better co-ordination of the demand and supply of voca-tional training, sometimes the demand may notcorrespond to the real need.

• Tax credit schemes are less beneficial for lowincome countries as firms are not able toorganise different types of training.

• The System of Mutualization may weaken themechanism when in a difficult economic situa-tion, many firms request the Fund to providethem resources at the same time (Atchoarena,1993).

• Sometimes due to structural adjustment in theeconomies there is an expansion in the informalsector and a decline in the number of largerfirms. This leads to reduction of tax contri-butions to the Fund and a shortage of availableresources for vocational training. The Fund hasto then search for alternative financing.

• It has been observed that sometimes the statemakes use of the resources of the Training Fundfor other purposes or it does not pay the TaxRevenue to which the Fund is entitled.

• Sometimes the Fund gets more occupied withbanking functions and investing the resources ithas collected rather than concentrating on devel-opment of training (Atchoarena, 1993).

• Experience has shown that with mutualizationsometimes there is favouritism towards larger,more privileged firms and towards employeeswho are already well trained. These benefici-


aries are better placed to negotiate theirdemands and get away with more funds(Atchoarena, 1993).

4.7 Policy implicationsWhile the single employer financing mechanismhas been very successful in Japan there are strongcultural influences which contribute to thissuccess. It is questionable whether in the absenceof cultural traditions such as spending a wholelifetime in one company or lasting obligations tothe school group, the family and the company, thissystem of individual company training could be assuccessful in other parts of the world.

In developing countries the responsibility fortraining cannot be left to the enterprises alone.The government has to organise and financetraining alongside to ensure social equity. Thedeprived and poorer sections of the society needadequate opportunities for training and the enter-prises may not necessarily cater to all thesegroups.

Payroll taxes help to develop training institutionsin the initial stages when institutions are buildingtheir training capacity. But it takes time to createtraining capacities and this may lead to high costsand sometimes inefficiencies in management.

While National Training Agencies have been moresuccessful in larger economies, the same successwas not possible in low income countries due tofactors such as restricted economies, weakmanagement, less financial resources and high unitcosts (Herschbach, 1993).

Use of tax rebates and credits creates a dynamicapproach to training when enterprises are encour-aged to become responsible for training, and isparticularly good for retraining and upgrading butless effective for pre-employment training. It isused best with other systems of financing. Taxrebates are particularly advantageous to largeemployers who have good management systems(Herschbach, 1993).

When resources are diversified for creating aTraining Fund, efforts should also be made to getadditional funding from the state in the form ofsubsidies.

Sometimes Training Centres may be manageddirectly by the management of the Training Fund.Fees can then be introduced to support financing.Donor agencies and regional authorities can alsohelp in the provision of resources (Atchoarena,1993).

The Training Fund is an important mechanism offinancing VET and can diversify its funding,depending on the quality of financial services itoffers.

5 Private and public sponsoredfinancing

Governments faced with a shortage of resourceswould like individuals, enterprises and non-government organisations (NGOs) to share thefinancial responsibility for VET.

5.1 Training feesIn some cases the entire operational costs areborne by the participants through payment of fees.

More commonly, employers or trainees bear partof the costs and government finances the remain-ing. Fees could be paid to the government or thetraining institution. In the informal sector theapprentices pay their master (Herschbach, 1993).

5.2 Fellowship, grants and loansIn most countries of the Latin American region,public financing is through fellowships and grants.The most important system of fellowships andgrants is being implemented in Chile. TheNational Employment Secretariat (SENCE)administers a large system of training fellowshipswhich are designed to offer training opportunitiesto unemployed young people, the poorer sections,the workers from informal sector and the handi-capped. The system is a supplement to taxrebates. The agencies which execute the trainingprogrammes are called OTE's and they are super-vised by the SENCE. From 1977 to 1987 SENCEprovided training to 300.000 persons with fellow-ships and grants through 19.000 courses organisedby different agencies. The courses were mainlyshort term ranging from 6 - 12 weeks and coveringa wide range of occupations e.g. agriculture andlive stock production, forestry, mining and trade.SENAEM has another training programme for


training young people in the age group of 18 - 24who do not have adequate access to programmesoffered by enterprises based on their tax rebates(Ducci, 1991).

Loans can facilitate training for students comingfrom poor families if they have to pay for voca-tional training. But in many developing countriesthere is no formal system of loans for education(Psacharopoulos and Woodhall, 1985).

5.3 Sale of training / non training servicesTraining Institutes can generate income from thesale of services to public and private enterprises orthrough individual tuition services.

Some VTI's sell complete training packages toenterprises. Some firms may even buy services forsetting up training units in their companies.INCAP, SENATI and SENAI in Latin America arewell known for this (Ducci, 1991).

Some VTI's offer non-training services such asconsultancies.

5.4 Co-financing agreementsIn Argentina co-financing has been arranged withenterprises, communities and vocational schools.In Colombia, Brazil and Peru also co-financing ispopular (Ducci, 1991).

When there is an agreement between differentparties then availability of funds becomes assuredand training can be related to the actual demand.

5.5 The German Dual SystemIn Germany more than two thirds of the 16 - 19year olds receive training within the dual trainingsystem (Greinert, 1992).

The system is called dual because there are twoplaces of learning - the vocational schools and thecompanies. The training is governed by trainingregulations of the Vocational Training Act, 1969.

The system offers a combination of training invocational schools with learning and practicalexperience at the worksite. In a week, apprenticesspend 1 or 2 days at the public vocational highschools where training in general subjects isoffered. The remaining part of the week is spenton the job in the firm/enterprise. Training is

usually for three and a half years after whichindividuals get certification and are free to getjobs.

The dual system sets high standards of trainingwhich leads to high productivity and competitive-ness of the labour force. This is why the workersand employees trained in the system are highlyappreciated by the German society (Timmermann,1993).

Expenditure on training is met by the state and theenterprise. School costs are provided by the Statei.e. the Länder (Federal States) and local authori-ties from the public budget whereas the partici-pating enterprise bears the cost of practical train-ing or in-plant training. No company is obliged toprovide training but it is evident from the numberof companies that participate in dual training thatthey have economic benefit from training theirown skilled workers.

The Federal Institute for Vocational Training, theinstitution of governance is totally funded from thefederal budget. The chambers and training boardsget their finances from levies on all member firms,specific fees from companies who demandservices of the chambers and boards e.g. in coun-selling and examinations, and subsidies from statebudgets for special activities. The firms/ enter-prises finance training from their own resources byoverrolling them onto the prices of goods andservices sold in the market; shifting part of thecosts on the taxpayer; returns from the trainingthrough the contribution of the trainees toproductive work; sale of training to other firms(Timmermann, 1993)

Outlays for Vocational Education and Trainingwere approximately 1.85 % of the GNP in 1992.Contributions by the public and private sectorincreased from 1980 to 1992, with the expenditureon vocational education and training, rising fromDM 15.5 to DM 51.7 billion (Federal Ministry ofEducation and Science, 1993/94).

In 1985, the annual unit cost to a company wasabout DM 20,500 for all apprenticeable trades.Companies recovered a fair percentage of thisfrom the work that the apprentice does and con-tributes to the production. The net cost to the firm


was eventually DM 16,000 approximately (Gilardiand Schulz, 1989). The German Federal Institutefor Vocational Training (BIBB) estimated for1980 that the gross cost to a company was aboutDM 17,000 and the net cost was about DM10,000. In 1991, the gross cost to a company roseto DM 29,573 with the net cost at aboutDM 17,862.

The cost surveys are however not completelyrepresentative as all training firms do not provideinformation and surveys in fact cover a smallnumber of training firms. Other limitations aredue to the structure of the in-plant training system.The value of the productive work of apprenticesduring in-plant training can only be estimated butcannot be exactly determined. It is also difficult toaccount for the actual staff costs of part-timeinstructors. But surveys do reflect accurately thetrends in the levels of vocational training costs(Hegelheimer, 1986).

The German Federal Government has continued tomake efforts to improve training financed byfirms. In 1973 a programme was started to pro-mote inter-firm training workshops aimed atimproving training by small and medium firmswhich were already providing more than half thenumber of training places. For the first timefederal aid was given to the dual system on asignificant scale. It was intended to raise theplaces in inter-firm training workshops from20.000 to 77.000. It entailed a total expenditure ofDM 2.7 billion of which the federal governmentpaid DM 1.7 billion, the Länder about DM 0.4billion and the firms about DM 0.6 billion. Firmsthat benefited were mainly craft firms and some inthe industry and agriculture.

Federal government also gave funds for vocationalschools for special areas. In the late 1970's Ländergave financial aid to provide extra training placesin firms to special groups such as girls, foreigners,the handicapped or apprentices from bankruptfirms (Schmidt, 1985).

In the dual system the federal government regu-lates the activities at the workplace through train-ing regulations. Regional (Länder) governmentswork closely with the implementing agencies.

There is need for constructive partnership betweenboth.

In Germany, the dual system has proved flexibleenough to offer a considerable number of trainingplaces even in times of economic difficulty. Inlarge scale industry about 80 % of apprentices aresubsequently employed by the company in whichthey trained (Raggatt, 1988). When large compa-nies invest in the training of their future employeesthey feel confident that the skilled labour forcewould be of high quality and in accordance withtheir requirement.

In 1987, the ratio of youth to total unemploymentrates in Germany was 1.1, while the average ratiofor 14 other OECD countries was 1.9 (OECD,1991). It would be reasonable to infer that appren-ticeship system in Germany is an explanation forthis pattern (Lauglo, 1993).

Financing by individual firms is a relatively ef-ficient system and it is doubtful if better resultscould have been achieved in Germany withanother financing system (Schmidt, 1985).

Among the developing countries, Jordan hassuccessfully adapted the dual training system con-ducted by the Vocational Training Corporation. Inlarge companies formal instruction as well aspractical training is provided on site therebyreducing costs. In smaller firms, apprentices aregiven formal instruction one day a week at atraining centre. Training in Jordan is effectivebecause of co-operation between VTC andemploying establishments, co-ordination of eco-nomic and training policy and centralised control.There are some problems too, such as inadequacyof off-site training. More vocational centres wererequired for theory work, so the costs went up. Allstudents were also not successful in getting jobs asthere are imbalances between the demand andsupply of skilled manpower (Herschbach, 1993).

5.6 Production for profitMoney raising through productive work is wide-spread in primary and secondary schools. In voca-tional training programmes, while students learnthey also produce. But a high percentage of costscannot be offset through productive activities.Generally the most effective programmes are


operated by NGOs which have greater flexibility.One would assume that the product which is bestfor the training institution to sell is training itself(Lauglo, 1993).

5.7 ApprenticeshipApprenticeship is a way of combining practicalexperience with theory. Generally there is aformal contract between an employer and a traineeunder which the trainee agrees to work for theemployer in return for practical experience whichmakes him a skilled worker. He gets a small wagetill he reaches the level of a skilled worker. Thusthe tradition of financing apprenticeship involvessharing of costs between employers and trainees(Woodhall, 1987). In India companies are obligedunder the provisions of the Apprentices Act toaccept a certain percentage of trained technicalpeople for apprenticeship ranging from a period of1 - 2 years. The apprentices are paid a stipend bythe company and the government on a sharingbasis.

5.8 Paid educational leaveAnother pattern of financing vocational and indus-trial education in some countries is the provisionof paid educational leave. Employers continue topay wages to employees while they receive parttime or full time vocational education. In somecountries e.g. France and Sweden there is legis-lation giving the right of paid educational leave toworkers. In some other countries there are varia-tions in the method of financing paid educationalleave. A study in 1976 concluded that the systemshifts the burden on the employers and createsmany ambiguous situations. Almost all countriesmake the financing of educational leave theresponsibility of the community. Therefore paideducational leave also becomes another way ofdistributing costs between the employers, workersand tax payers (Woodhall, 1987).

5.9 Non-governmental and voluntaryorganizations

The involvement of Non-Government Organi-sations (NGOs) and Voluntary Organisations inthe implementation of VET is yet another way ofcost sharing or financing of vocational pro-grammes. Sometimes NGOs are charitable insti-tutions working with the aim of upliftment ofweaker and poorer sections of the society. Suchinstitutions may have their own infrastructure and

when they come forward to participate in VET,they can be successful especially in conductingshort term training programmes in the rural orurban informal sectors. At times they provideeducation and training entirely from their ownresources and at other times they receive grants orsubsidies from the government.

In developing countries, the involvement of theNGOs in vocational training is assuming greaterimportance as governments continue their searchfor partners to share costs on training. In India e.g.the Society for Rural Industrialisation in RanchiBihar is conducting vocational training coursesrelated to rural technology for the poor tribalpeople of the local region. Grants are given by thecentral government and other agencies but theorganisation has to bear responsibility for somepart of the costs. Similarly there are many otheragencies voluntarily engaged in educational andtraining activities.

In the Philippines too, the involvement of NGOsin the social development process of the countryhas gained momentum in the last few years. Dual-tech has been offering vocational training inManila and other parts of the Philippines throughthe dual system with the involvement of the com-panies. It started its activities in 1982 with contri-butions from the industry and donations from theHanns Seidel Foundation in Germany.

Since 1990 Dualtech has become more independ-ent in its financing by adopting the dual systemthrough which there is a sharing of costs with theindustry. A large number of students from thelower income group are trained and 15 % of thepoorest students are given scholarships. The NGOtries to maximise its resources through optimumutilisation of existing facilities for training. Whennot in use for training, the facilities are used forcommercial production on a small scale. In 1993the organisation had an operating budget of $600,000, of which 95 % came from the industryand 5 % from the Hanns Seidel Foundation(Dualtech, 1993).10.


Advantages• Training fees enhance efficiency and contribute

resources as well. Participants are likely to pay


for training if it is of good quality and can bringpersonal benefits and high private rates ofreturn.

• Fee level can control excessive demand as feescan be raised if there is more demand.

• If fees are high the quality may improve.• Fees are found to be effective in financing short

term training in the informal sector. Mastercraftsmen are paid small stipends for additionaltraining which they give in approved sites. Thisis more economical than organised formaltraining (Herschbach, 1993).

• Loans are good for financing short term training.• Sale of training services facilitate additional

income for Vocational Training Institutes.• Co-financing agreements raise the resource level

of VTI's.• Training can be organised in accordance with

demand and therefore enhance training-employ-ment linkages.

• Dual training system is beneficial to firmsalthough cost figures are difficult to calculatedue to hidden expenditures e.g. breakage andwaste of materials, lower productivity of experi-enced workers who spend time in instructingapprentices. Work of apprentices also offsetscosts.

• Dual system is an efficient system of financingby individual firms and it is doubtful if betterresults could be achieved in Germany withanother financing system. From 1980 to 1984the number of college graduates entering thedual system rose from 20,000 to 80,000(Schmidt, 1985).

• Production for profit can offset a small percent-age of costs. In low income countries schoolproduction may help to supply goods andservices when there are shortages (Herschbach,1993).

• Paid educational leave motivates the workers/employees to upgrade their skill levels. Higherand more skills contribute to productivity.

• NGOs generally work for charitable causescontributing to the socio-economic developmentof the country. When they become involved invocational training they take over the liability offinancing some of the costs which would other-wise fall on the government.

• As they are highly motivated and often work forthe upliftment of the poorer and weaker sections

of the society, their contribution leads to socialequity.

• They are mostly very successful in providingshort term training.

• NGOs operating in the rural and urban informalsectors generally have a good knowledge of thelocal market. Thus they can effectively linktraining with the local employment requirement.

• Non-profit making NGOs generally have dedi-cated persons on their management. They arekeenly engaged in offering good quality voca-tional training and can thus provide effectivesupport to vocational training systems.

Disadvantages• Fees affect poor students or the underprivileged

as they may not get access to training.• Training fees cannot fully support programme

costs.• If fee levels are too low it affects incentive to be

responsive to students as the income from feescomprises only a small portion of the budget. InSri Lanka the Foreman Training Instituterecovers 10 % from fees paid by students andemployers and government pays the remaining90 %. The Institute is not concerned to observeeconomy measures, have a relevant curriculumand respond to market needs (Bressler andHultin, 1987).

• Fellowship programmes can be expensive forgovernments as there are higher administrativeand management costs (Herschbach, 1993).

• Fellowship programmes are subject to politicalinterference.

• Loans involve problems of disbursements, col-lecting repayments and preventing defaults.

• Loans do not lead to greater equity as affluentstudents are in a better position to make use ofthem (Psacharopoulos and Woodhall, 1985).

• Too much emphasis on training services detractfrom the main function of Vocational TrainingInstitutes which is vocational training.

• In the dual training system there can be im-balance between training demand and placementopportunities. To regulate imbalance, trainingworkshops are set up in larger firms for supple-menting on-the-job training. In countries whichdo not have a tradition of shared responsibility,dual system can be exploited by firms e.g. thefirms can use trainees as cheap labour.


• Training by firms can meet only a part of thedemand for training and cannot help to solvesuch problems as training of people with learn-ing difficulties, language defects etc. (Schmidt,1985).

• Sometimes institutions pay more attention toproduction activities than devoting time andeffort to formal learning.

• As NGOs are not always subject to externalscrutiny they may not maintain a high standardof training.

• They may also have problems of certificationespecially if they are very small organisationsworking in the rural or urban informal sectors.

• Sometimes NGOs may experience a shortage ofresources. In such circumstances some of themare found to have an over dependence on foreigndonors.

5.11 Policy implicationsThere are limits to which fees can be used tofinance VET. Too much reliance on fees is notadvisable as it cannot fully support training costs.

The most efficient way would be for governmentsto give subsidies to complement the use of fees.

Fees could be high enough to generate adequateincome but not so high as to stifle the demand(Herschbach, 1993).

Fellowships are not effective in low incomecountries. The more affluent usually benefit more(Herschbach, 1993). The system of student loansis not very prevalent in developing countries.

While sale of training and non-training servicescould become a secondary source of income, itshould not become the main objective of Voca-tional Training Institutes. The Institutes shouldprimarily concentrate on development and provi-sion of training.

Co-financing agreements raise the volume ofresources available for vocational training. Insti-tutes which have such agreements keep theircourses updated and relevant to new technology(Ducci, 1991).

Dual system is an effective system of financing byindividual firms. It is beneficial to firms, trainees

and the society. The dual system involves collabo-rative financing with contributions from tax reve-nues, enterprises and the trainees. Mobilisation ofadditional resources is achieved as there are closelinks with enterprises and a rough balance betweendemand and supply. Training in the dual system issuccessful when there is a constructive collabora-tion between social partners and adequate potentialfor placement. Training is also less likely to beobsolete as close links with employers are main-tained (Herschbach, 1993).

Production for profit is not a reliable way togenerate a large amount of resources for formalVET programmes. Production activities in formalVET should be limited so that more time is spenton formal learning. Local institutions will alsorequire some autonomy for introducing a curricu-lum shaped by local production requirements(Herschbach, 1993).

Paid educational leave is a good way to upgradethe skills of an employee. While the burden offinancing may become shared, the systempromotes motivation in the workers to enhancetheir skills and qualifications thereby contributingto productivity and economic growth.

In the developing countries the involvement ofNGOs in vocational training is gradually assuminggreater importance. They not only share the finan-cial burden but some of them are known to workfor the upliftment of the downtrodden and weakersections of the society. Thus they support thevocational training systems by helping to equaliseopportunity in training for all and contribute to thesocial developmental process. They should beencouraged to come forward in closer partnershipwith the governments in organising VET.

6 International donor assistanceDonor support plays a very important role indeveloping VET systems.

In many developing countries the large amount ofinternational aid has contributed to the setting upof a base of training capacity. Infrastructure andfacilities have been created, staff trained andinstructional systems implemented through donorassistance. Mostly donors provide financial re-


sources for capital costs and it is limited for shortperiods (Herschbach, 1993).

In the 1980's, international assistance to vocationaland technical education and training averagedabout $ 600 million annually of which the WorldBank provided 45 %, bilateral agencies 30 % andother multilateral agencies 25 %. Approximately40 % of multilateral assistance for education wasused to support VET programmes. NGOs andprivate sources also made a sizeable contributionbut the exact amount is not known (World Bank,1991).

From 1963 to 1976, 40 % of lending for educationby the World Bank was for VET at the secondaryand post secondary levels. But evaluations con-ducted in the 1970's regarding cost effectivenessof vocational schooling especially diversifiedschools began to raise doubts. The World Banklending then began to shift from diversified voca-tional education to centre based vocational trainingand development of national authorities (WorldBank, 1991).

In Africa about 7 % of direct international aid goesto finance primary education, 40 % to secondaryeducation and 17 % to VET. For every S 1 spenton a primary school pupil, S 11 is spent on asecondary school student and S 182 on a VETstudent (World Bank, 1988).

In Latin American countries much of the institu-tional infrastructure for VET was built throughinternational donor assistance. A study of SENAin the 1970's showed that it had taken the maxi-mum advantage of technical assistance offered byforeign governments and international organisa-tions. The Brazilian SENAI at present benefitsfrom assistance of nearly all countries of the EECand Canada, Israel, Japan and USA (Ducci, 1991).In the beginning vocational training institutionssought international support for starting the Insti-tution. Subsequently international resources triedto achieve the transfer of productive technologywhich would be appropriate for national develop-ment.

Among multinational donors a very high amountgoes towards capital expenditures and amongbilateral donors a greater share goes for technical

assistance and overseas fellowships at the expenseof support for recurrent costs (World Bank 1988).


Advantages• Donor assistance helps to set up vocational

training institutions.• In some of the low income countries, but for

donor support, it may not be possible to createinfrastructure required for VET.

• Donor assistance facilitates transfer of latestproductive technology to low income countrieswhich can stimulate economic growth.

• Donors provide technical assistance fromcountries which have been successful in voca-tional training.

Disadvantages• VET systems require long term support as they

take long periods to mature, sometimes decades.Donor assistance is generally short term, some-times for a few years. Donor agencies generallydo not make long term commitments. Thislimits the effectiveness of assistance as recipientcountries are not able to make long term plans.

• Donor agencies like to fund capital expenditureas it is easier to calculate and measure. Capitalinvestments such as newly constructed buildingsare visible and proof of the contribution madeby the donor and therefore said to have greaterimpact. Extensive facilities are thus built whichmay not get adequate recurrent support fromgovernments because they do not have adequateresources (Herschbach, 1993).

6.2 Policy implicationsDonor assistance is found to concentrate on capitalcosts creating large training facilities. Pro-grammes cannot operate successfully withoutadequate support of recurrent expenditure by thehost country. Therefore the size of the project tobe funded by the donor and its duration should bebased on the capacity of the recurrent fundingavailable. Otherwise a project started with goodintentions may start malfunctioning. The mostsuccessful donor projects are those which layemphasis on strengthening the management andupgrading the quality of staff of training insti-tutions (Herschbach, 1993).


Distortions should be avoided between overimportance on capital expenditure as comparedwith recurrent costs. If initial investments are veryextensive, countries may not be able to sustainVET institutions. When this happens the qualityof the programmes in the institutions deteriorateand the project does not yield adequate return onthe investment.

Donor assistance is most effective when a moder-ate level of finance is provided over a long periodof time (Herschbach, 1993). Long term partner-ship with governments helps them in their effortsto build proper training facilities.

The host country should strengthen its essentialsystems so as to sustain the project long after thedonor assistance is over.

7 ConclusionGovernments will continue to finance VETthrough public revenue as the overall responsi-bility for development of human resources in thecountry rests with it. Without adequate invest-ment in education, it is almost impossible to pro-mote development. Government support infinancing VET will therefore continue to flow andremain the most reliable.

With diversification of financing mechanismshowever, larger resources are available for creat-ing more training opportunities. But the problemsof financing VET cannot be solved entirelythrough diversification of resources. Efforts haveto be made to better utilise available resources byremoving existing inefficiencies, stricter account-ability, improving organisational structures andproper application of new information technology.Vocational training systems should remain flexiblewith the ability to adapt to the changing social,economic and technological requirements of thecountry. To keep vocational training dynamic thefollowing should be borne in mind:

• Public revenues are used mainly to finance pre-employment VET but pre-service and in-serviceVET is also being supported. Vocational Train-ing Institutions funded through national budgetshave more stability as there is a consistent flowof resources and the institutions can plan itstraining possibilities accordingly. When there is

a reduction in the budget due to shortage inavailability of overall resources it could affectthe training programme in quantitative andqualitative terms.

• Single employer financing in Japan has provedvery successful. However the strong culturaltraditions prevalent in the Japanese society havein some measure contributed to making thistraining system the backbone of the growingeconomy. As a mechanism of financing it ishighly recommended if it works as well in otherparts of the world.

• Excessive dependence on payroll levies as animportant financing mode has to change slowly.There has been criticism that taxes imposed onemployers eventually discourage the demand formanpower. Payroll levies have however beeneffective in building national training capacityespecially in middle income countries.

• Tax rebates have been effective in financing inservice training and less effective in pre-employment training. Small and medium sizedenterprises do not make much use of it.

• Fees can easily finance VET but there are limitson the amount of resources that can be gener-ated. Fees are a better way to finance short termtraining.

• Fellowship and loans do not generally work indeveloping countries.

• Production for profit is effective in financingVET for poor youth, unemployed school leaversand disadvantaged adults. It works best in pro-grammes operated by NGOs.

• While co-financing agreements are emerging asa popular method of generating resources, othersources of funding are required for providingfinancial stability. Agreements with firms andenterprises bring training institutions into closercontact with market requirements and with theemerging of new technology and bring betterprospects of return. However generally, onlythose sectors which have enough resources canpropose significant agreements (Ducci, 1991).Donations from the private sector in exchangefor their involvement in the curriculum designof training programmes, and membership ofgoverning boards can also be explored.

• The Dual System is an efficient system offinancing by individual enterprises. Firms pro-vide training voluntarily at their own expense asthey believe it is the best way to train a skilled


workforce according to their requirement. Theyalso demonstrate a social responsibility fortraining as a contribution to economic develop-ment. But it is not only the firm which investsin the trainee. The trainee does his share ofwork, thus to a certain degree offsetting theexpenditure the firm incurs on him. The costsof vocational training also reduce the tax on thefirm's profits.

• Although the dual system involves collaborativefinancing with contributions from tax revenues,enterprises and the trainees, it does not reducemuch the overall tax burden on public revenuesbut the employers play a very crucial role in thetraining through apprenticeship. Training in thedual system is very successful when there is aconstructive collaboration between social part-ners and adequate potential for placement. It iswidely acknowledged that one of the reasons forthe economic success of Germany is the voca-tional training of its labour force.

• involvement of NGOs in cost sharing for VETin developing countries is gaining momentum.Not only do these organisations bear a part ofthe financial liability but they are also known towork with a commitment for the socio-eco-nomic development of the country. Govern-ments should try to bring forward more NGOsas partners in vocational training.

• Donor Assistance is a very important source offinancing vocational training systems. It iseffective in all types of VET programmes but ithas its limitations. Generally building of institu-tional infrastructure is through support forcapital expenditure. But donor assistance cancause inefficiencies if the project cycles are tooshort and the host country is not able to maintainthe quality of the institution. Donor assistanceshould have long term development policies,resources should be concentrated and specialattention should be paid to recurrent funding(Herschbach, 1993).

Vocational training systems should continue itssearch for generating additional resources throughthe public and private sector such as governmentsubsidies, enrolment fees in the long term or con-tributions from associations and unions. Theyshould maintain a certain proportion of incomefrom payroll levies and use it effectively forencouraging co-financing with enterprises. They

could include decentralised and local bodies in thesale of general services to adapt to the newrequirements of the governments. They shouldalso make use of non-monetary contributions inthe form of equipment and new materials for thetraining centres which may be donated throughagreements with business.

If vocational training systems are very large andprogramme activities cannot be adequatelysupported, it may be better to reduce the pro-grammes and consolidate the existing resourcesand reallocate them appropriately. The importantthing is effective management of the institutionthrough a proper balance between capital andrecurrent expenditures. All training componentsshould be strengthened and emphasis should be onquality training. The management should workclosely with the employers.

Diversification of resources is not easily possiblein countries which have highly centralised systemswith rigid controls. New ways of raising resourceswill require new working relationships with relig-ious bodies, trade associations and that requiresdelegation of authority. Governments have toconsider making these changes (Herschbach,1993).

The economic situation in the country also affectsthe financing mechanism. In low incomecountries there is a shortage of resources in theGovernment. At the same time it is not possible tofind many suitable alternatives to governmentfunding. In the middle income countries there aregreater possibilities for diversifying financing andexperience has shown that it is possible to havedifferent forms of vocational education andtraining.

Strategies for financing VET have to take intoaccount the pattern of economic development.There is no optimal combination of financing. Inmost countries there is a need to diversify trainingand new ways of financing may lead to new waysof training. Attempts to diversify financing willensure stability in the long term as it will reduceexcessive dependence on a single source. If thereis financial stability, it will lead to better qualityVET programmes (Herschbach, 1993).


There is no single or universal solution for financ-ing vocational training and no one method whichcan serve all sections of the society. There aremany different limitations in every system.Questions about who should meet the costs, theemployers, individuals or the government areraised from time to time. A World Bank studyreviewed the literature on these questions andconcluded that the survey eventually raised morequestions than it answered and that there is nouniversal solution about the absolute effectiveness

of any one method (Zymelman, 1976). A combi-nation of funding leads to greater access in VET.Diversifying financing will create greater oppor-tunities and improve the quality of training(Herschbach, 1993). Governments have to realisethat funding from public revenue is not the onlyway to finance investment in vocational educationand training. There should be a determination toinvolve employers, individuals and the localcommunities.

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Dualtech, 1993. Report of the Joint Executive andManagement Committee for 1993. Dualtech,Philippines.

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EICHER, Claude, J. 1989. The Financial Crisis inEducational Systems. In: The Prospects forEducational Planning, edited by Caillods, F. IIEP,UNESCO, Paris.

Federal Ministry of Education and Science, 1993/94. Basicand Structural Data, Federal Ministry of Education andScience, Bonn.

GREINERT, W. D. 1992. The dual system of vocationaltraining in the Federal Republic of Germany. Structureand function. GTZ, Eschborn.

HEGELHEIMER, A. 1986. Financing of Vocational Training.German Foundation for International Development,Mannheim.

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INOUE, K. 1985. The education and training of industrialmanpower in Japan. World Bank Staff Papers 729.Washington.

Inter-American Centre for Research and Documentation forVocational Training. 1991. Vocational Education onthe Treshold of the 1990's. Volume I & II. The WorldBank, Washington, DC.

JOHNSON, R. 1979. Education and Training in the 80's.Department of Employment Gazette 87.

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LAUGLO, J. 1993. Vocational Training: Analysis of Policyand Modes. Case Studies of Sweden, Germany andJapan. International Institute for Educational Planning,Paris.

LOURIE, S. 1987. New strategies for financing diversifiedforms of education and training. International Institutefor Educational Planning, Paris.

LAUTERBACH, Uwe. 1985. Vocational Training in the USA.In: Journal for Educational and Social ScienceResearch. Frankfurt.

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MC CORMICK, K. 1989. Towards a life long learningsociety? The reform of continuing vocational educationand training in Japan. In: Comparative Education 25(No 2).

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ATCHOARENA: Financing Vocational Education: Concepts, Examples and Tendencies Page 27

Financing Vocational Education: Concepts, Examples and Tendenciesby David ATCHOARENA

Mr David ATCHOARENA is a staff member of UNESCO’sInternational Institute for Educational Planning (IIEP).

4

1 IntroductionThe financing of vocational education is of in-creasing concern to governments as well as, inmany countries, to industry. This renewed interestis often due to adverse economic and financialconditions, but it is also linked to the search forcost-effectiveness in a context of intense inter-national competition.

Over the past decade many countries have beenforced to introduce economic adjustment andstabilisation policies. Such programmes have hadserious effects on patterns by which governmentsfinance education (Samoff, 1994). In many cases,adjustments led to drastic measures aimed atminimising government spending and transferringcosts to other actors. This orthodox policy has notleft vocational education unscathed. In this con-text, higher unit costs constitute an additionalhandicap in the financing of training.

It is difficult to measure the bulk of spending allo-cated to vocational education and training. Offi-cial data, such as those published by UNESCO,usually refer to central government expenditures,overlooking spending made by decentralised units,such as local governments which, in certain coun-tries, may play a significant role in financingtraining. In addition, the integrated nature ofsecondary education in some systems does notallow for the easy differentiation between thevocational and general components. In fact, thelack of clear definitions makes it difficult to pro-duce comparative data. Finally, a large share ofinvestment in vocational education, by companiesand individuals, often remains invisible. As dataon the different sources of financing are notalways recorded in an exact manner, it is possible

4 This chapter is inspired by a study published in 1994

(Atchoarena, D.: Financement et régulation de la formationprofessionnelle: une analyse comparée, UNESCO/IIPE)

that the overall financial effort involved in trainingis underestimated.

In a context of financial scarcity, vocational edu-cation has to provide clear evidence of economicand social returns. In many countries, such evi-dence is lacking, which is threatening the sustain-ability of the system and leading to a thoroughquestioning of vocational education. At the sametime, in a period of high unemployment, politicalpressure to expand vocational education oftenbecomes more intensive.

Vocational education has been an important com-ponent of international assistance to education(Middleton; Ziderman, 1993). However, projectsupport has often been preferred to a more inte-grated sectoral approach. Recent shifts in inter-national assistance seem to seek sustainabilitythrough a long- term strategic approach. Currentdirections include institutional capacity-building,strengthening private training and training by theemployer, improving the management and effi-ciency of public institutions as well as their capac-ity to raise funds. At the same time, support forgeneral secondary education seems to be consid-ered as a priority for the fostering of flexibility, theincreasing of "trainability" and the achievement ofequity (Hallak, 1990).

Although the reference to so-called 'models' isfrequent, the overall management and co-ordina-tion of national training systems is quite varied,ranging from centralised planning to market-oriented regulation (Caillods, 1994). Similarly,financing training modes are very diverse and farmore complicated than a simple choice betweenpublic spending and earmarked payroll taxes.Such a diversity, combined with the constantevolution of national systems, makes overallcomparisons somehow difficult. However, it isworthwhile identifying and analysing the range ofoptions available. With this in mind, this chapterreviews the main issues and focuses on selectedcountry experiences, illustrating different kinds of

ATCHOARENA: Financing Vocational Education: Concepts, Examples and Tendencies

strategies and instruments involved in the financ-ing of vocational education.

The assumption of this chapter is that fundingpolicies for vocational education should not beconsidered as purely a combination of financialdevices and mechanisms commanding the collec-tion, allocation and spending of resources. Theyalso reflect and have an impact on the distributionof authority throughout the system: controllingfinance is always a major asset in influencing thedecision-making process (Atchoarena, 1994).Furthermore, if one also considers that the trainingsystem must prove highly adaptable to economic,technological and organisational change, thefinancial participation of various kinds of partnersand, in particular, industry, may not only increasethe availability of funds but, eventually, have apositive impact on training volume and content.

2 Issues and policies

2.1 The emergence of new principles ofgovernment intervention:Cost sharing and subsidiarity

Wide recognition that the State can no longerassume alone the financial burden of vocationaleducation has led to the development of newmodes of government intervention such as cost-sharing and subsidiarity. The effort of govern-ments to share the cost of education, includingvocational education, with other members ofsociety has now become a global phenomenon,affecting both developing countries and industri-alised nations (Gasskov, 1994). Apart from beingan expression of cold pragmatism - compensatingfor the decrease in government spending - costsharing corresponds to the belief that the financialburden of education should be distributed amongall beneficiaries (Birdsall, 1986)). Hence, employ-ers and individuals who take advantage of higherproductivity and income should contribute to thecost of vocational education.

Implementation of the cost-sharing principle hasled to the introduction of a diversity of measures,such as student fees, employer sponsorship oftrainees, technology-transfer grants and contractsfrom industry, sale of continuing education serv-ices, sale of other products and services. Deferredpayment through the use of loans has also been

considered as a promising way of securingresources from students, based upon their futureincome. Although student loans have mainly beenimplemented at university level, such a systemcan be applied to other levels and forms of educa-tion, including post-secondary technical education.

Together with cost sharing, the principle of sub-sidiarity tends to become a central tenet in theclear definition of the respective roles and respon-sibilities of the various levels of government,including in public spending. In brief, subsidiarityholds that the central level should only controlwhat cannot be done effectively at a lower level.

In the field of vocational education it seeks touphold the local dimension of the training systemor, at least, the relevance of training provision vis-à-vis the needs of local labour markets. Therefore,within a decentralised framework, financingtraining should be organised according to theprinciple of subsidiarity, the central state only sup-porting programmes that cannot be efficientlycovered by lower entities, for instance, those con-sidered to be critical for industrial developmentstrategies or those aimed at vulnerable groups.

However, in practice, even assuming that localgovernments have a comparative advantage inproviding training, the huge differences observedin tax base at this level would hardly ensure anadequate amount of finance. Hence, the centralgovernment may retain the role of harmonisingfunding in order to guaranty minimum standardsacross the country.

In spite of the far reaching implications of cost-sharing and subsidiarity, many economic justifi-cations remain for the subsidising of vocationaleducation services. First, benefits are not onlycaptured by individuals, or firms, but have a spill-over effect on the entire society. Indeed, assumingthat most initial training is transferable, vocationaleducation may be considered as a quasi-collectivegood, just like general education. Secondly,economies of scale can only be achieved throughproviding services to a significant share of thepopulation. Finally, in the absence of sufficientknowledge of the costs and benefits of alternativeforms of education, it is doubtful whetherindividuals, or enterprises, are able to make the


best decisions. This lack of information wouldthen lead, at the macro level, to a state of under-investment in training.

In addition to the economic rationale, it is arguablethat leaving the vocational education of the dis-advantaged groups in society entirely to what theycould buy on the open market would be sociallyunacceptable. Therefore, training for such groupsmust rely on public money, although other sourcescan also contribute.

2.2 Apprenticeship: Sharing trainingresponsibilities and costs

In many countries, apprenticeship constituted thetraditional way of educating the labour force forcraft production. Progressively this training mode,which involved skills being imparted on-the-jobby masters to young people, was transferred toindustrialised business. Compared to othertraining modes, apprenticeship is characterised byits capacity not only to train but also to organisethe process of transition of the young labour forceto the labour market (Greffe, forthcoming).

Through apprenticeship, the cost of training isborne by the employers who, in turn, compensatefor the poor productivity of new apprenticesthrough low wages (below the marginal produc-tivity rate). Therefore, in its traditional form,apprenticeship is a cheap way of training youngpeople for the State, the cost being shared betweenthe employers on one side and the apprentices, andtheir respective families, on the other.

Another advantage of apprenticeship remains inthe way it adjusts, at least in theory, training pro-vision to the needs of the enterprise, in accordancewith business cycles. Therefore, it is often arguedthat this system ensures efficient resource allo-cation through market forces.

For all these reasons, largely brought to light bythe popularity of the German dual-training system,apprenticeship features prominently in the inter-national debate on vocational education(Timmermann, 1993). This is the case not only inindustrialised economies but also in developingcountries. In fact, this issue is marked by a strongcurrent in favour of the introduction, moderni-sation or development of the apprenticeship sys-

tem. However, the actual implementation of the'model', in terms of the rationale inspiring it(training or employment policy) or the operationalfeatures (labour status, duration, wage rate, dual orcompany based etc.), differs widely from oneplace to another.

Considering such variations, the term 'apprentice'itself can be misleading. It is applied to verydifferent activities and attainments acrosscountries. As a result, the concept of apprentice-ship, often equated to the term 'dual training', is, infact, relatively vague, if not ambiguous.

Similarly, the term 'market financing', often usedfor apprenticeship, can be a source of misinter-pretation. Although, in the theoretical model,training is financed, on one side by employersinvesting in apprentices' skill formation, and onthe other side by individuals, the apprentices, andtheir respective families, accepting low wages andsometimes paying fees, contemporary apprentice-ship combines market financing and public inter-vention. For instance, various legal instruments,such as fiscal or monetary incentives, often makeit attractive for employers to take on apprentices.In addition, in systems based upon the concept ofduality of training, centre or school-based trainingis usually financed out of general taxation.

Yet, the actual mechanisms being put in place tofinance apprenticeship should not only be evalu-ated from the point of view of financing andtraining concerns but should also be seen withinthe framework of labour market policies.

2.3 The consumer rationale:Privately financed institutional training

Private institutions tend to make an increasingcontribution to training. They constitute a veryheterogeneous sector, difficult to define and toclearly delineate. Legal status, ownership, objec-tives, operations and, of course, financing aresome of the criteria differentiating private voca-tional schools and training centres.

Tuition fees, paid by individuals or enterprises,usually represent a significant, if not a majorsource of income. However, in many countries,private institutions also benefit from governmentfinancial allocations and tax incentives. Institu-


tions linked to NGOs may raise a significant shareof their resources through donations.

It is arguable that private training institutionsconstitute a market-financed response to a growingsocial demand. Apart from reducing reliance onthe state budget, it is hoped that the private sectorcan promote fair competition, eventually leadingto cost reduction. Yet, the quality of traininggiven by this sector varies immensely from oneinstitution to the other. In fact, the variation inquality may be much wider within the privatesector than for public institutions that have to meetcertain standards. It is doubtful that this issue ofquality control can be resolved by pure marketmechanisms. In many countries, governments aredeveloping information on training supply andtrying to regulate the training market by intro-ducing accreditation and monitoring mechanismsfor private institutions.

Apart from the quality issue, private provisionraises the question of access for low incomegroups. A fair system should make provision togrant financial assistance to students from thepoorest families. Furthermore, past experience hasshown that private institutions have a tendency toinvest in 'cheap to teach' subjects, leaving pro-grammes requiring heavy infrastructures togovernment. This short-term market rationalelimits the capacity of the private sector to providea viable alternative to public provision (De MouraCastro, 1995). Nevertheless, it can be a usefulsupplement to public structures and finances.

The market approach to vocational education doesnot only lead to the development of private insti-tutions. It also has an impact on the way publicinstitutions are managed and financed. In particu-lar, it is argued that market incentives provide abetter manner of allocating resources. Apart fromthe introduction of cost-recovery measures, thispolicy advocates giving institutions autonomy overprogrammes, admissions and financial resources.Increasing financial autonomy may also encouragepublic institutions to develop income-generatingactivities and seek local solidarity throughstrengthening links with businesses and communi-ties in their environment. Besides attracting dona-tions in cash or kind, such a strategy is meant to

improve the capacity of institutions to assesstraining needs at the local level.

Increasing accountability is usually the counterpartof more autonomy. In the context of a decentral-ised and competitive framework, institution man-agers are encouraged to move away progressivelyfrom the traditional pattern of basing budgetestimates on allocations of previous years, infavour of a system based on performance.

Introducing the use of vouchers can offer an alter-native way of allocating funds to training insti-tutions (Herschbach, 1993). In line with theprinciple of consumer-paid services, this mode ofintervention reflects a major shift towards ademand-driven formula. This funding arrange-ment, based on output rather than on input,requires, among other things, that individuals andenterprises be fully informed of the programmes ofinstitutions and their performance. However, theirlarge scale use would introduce instability andeventually threaten the sustainability of thetraining system.

Whatever the mechanism might be, the allocationof public money to institutions enjoying greaterautonomy inevitably raises the issue of control.The market-feedback system is often said to be themost effective. Nevertheless, some reservationscan be made concerning its reliability, taking intoconsideration the information problem and theneed to follow certain national objectives, such asthe promotion of labour mobility or giving priorityto specific groups.

2.4 The use of earmarked taxation tofinance training

International data tend to show that, althoughgeneral taxation still represents, in most instances,a major source of funding, especially for initialtraining, earmarked taxation now constitutes asignificant option. It usually takes the form of apayroll tax and finds its justification in the equityprinciple, which stipulates that enterprises shouldbe responsible for the cost of the education whichis of direct benefit to them (Whalley; Ziderman,1989, 1990).

Although the human capital theory indicates thatenterprises benefit from investment in training,


they may actually underinvest due to the so-called'poaching effect'. This phenomenon, alsodescribed as a 'free-rider issue', reflects the factthat some 'smart' employers, rather than investingin training, prefer hiring ('poaching') workers thathave been trained by a competitor. Eventually,this risk may discourage employers from trainingtheir employees beyond enterprise-specific skills,resulting in an overall underinvestment in humancapital. Correcting such a 'market failure' requiresState intervention, such as introducing a payrolltax to finance transferable training.

Subject to renewed interest, payroll taxes cannotbe considered as a financial innovation: let'sremember that they were first introduced in Brazilin the early 1940s. Their great potential forexpanding the tax base under which training isfinanced explains the wide dissemination of train-ing levies and their adaptation to various nationalconditions in developing as well as in developedcountries, notably in Europe (Drake; Germe,1995).

Financing systems based upon payroll taxes areoften classified into two groups(Whalley; Ziderman, op. cit.): the revenue-raisingschemes, and the levy grant or rebate schemes.Each type corresponds to a different objective.Revenue-raising schemes are usually implementedto finance the establishment of a training system(the so-called 'Latin-American model'). Levygrant, or rebate schemes, constitute incentives toemployers to develop in-service training. Incen-tives can either take the form of reimbursement ofpart of the training cost, exemption of the traininglevy or a rebate in company tax.

According to the country, available data indicatethat the rate of the levy varies from 0.5 % to 4 %of the payroll. In some cases, it also changesaccording to sectors of the economy and size ofthe enterprise's workforce. The public sector aswell as small enterprises are often exempted. Theintroduction, and sometimes abandonment, of afinancing scheme based on payroll tax dependsvery much on specific considerations, such as theavailability of skills and training, the overallstructure and weight of the tax system, the cost oflabour, and the strength of the consensus between

the State, employers and the wider communityregarding the necessity and use of a training levy.

The main criticism of payroll taxes lies in theirinflationary effect on labour costs. This concern isparticularly strong when fiscal and social levies onlabour are already high. Eventually, using payrollas the basis for the training tax might have othermacro-economic effects. In particular, such asystem produces a distortion between labour-intensive and capital-intensive enterprises thatcould supposedly affect investment patterns and,in the long run, the economic structure.

These examples show that payroll taxes cannot beconsidered neutral as far as inflation, employmentor even industrial development are concerned.The instruments selected to finance vocationaleducation have broad implications which reach farbeyond the field of training policies and outcomes.

2.5 From financing to regulation:Training funds

The introduction of payroll tax has led to thecreation and wide dissemination of a new type ofinstitution often managed by both the public andprivate sectors, sometimes also involving unionsthrough a tripartite formula. These bodies orTraining Funds, which collect and allocate theresources raised by the tax, combine financial andtraining responsibilities.

In some cases, financing and promoting trainingare the major objectives of such institutions. Inothers, the Fund is incorporated into a broaderTraining Agency or Board which also operates itsown training system, parallel to the vocationalstreams of the education sector, and sometimesdecides upon the national training policy (Wilson,1993). Indeed, giving the management of TrainingFunds to the social partners can contribute to theenhancement of the quality, relevance andflexibility of training.

The central Fund model is not the only option, andsome countries have established sectoral bodies(Drake, 1991). Mostly applied in the developingworld, the use of a large centralised Fund tends toredistribute training costs between training andnon-training firms. Sectoral Funds can better meetthe requirements of well organised sectors of the


economy or facilitate dealing with specific man-power or qualification shortages.

The collectivisation, or mutualization, of resourcesallowed by the Funds, especially central Funds,helps in the development of a collectively agreedtraining strategy aimed at specific types of firms,sectors, categories of workers or regions. Thisoption can be a very powerful instrument for pro-moting both equity and effectiveness. In somecountries, notably in Latin America and Africa,Funds have been used to implement specialprojects for the informal sector.

In financial terms, this redistributive function ismade possible by introducing a formula, wherebyindividual firms have access to only one portion oftheir contribution to finance their own training.The balance remains accumulated in a collectiveaccount put at the disposal of the Fund to financeprogrammes decided upon by its governing body.It is important to note that, for many institutions,accumulated savings constitute a stabilisation fundthat can be used to finance capital investment orface a drop in payroll tax collection.Usually, nation-wide Funds both levy for theirown training policy and make grants to trainingfirms. Progressively, many of them have devel-oped their activities to provide, on a cost-recoverybasis, consultancy services to enterprises in thefield of human resources development. They alsooften play a key role in regulating the trainingmarket by introducing accreditation procedures,and quality control for private training institutions.

The diversification of services and resourcesrepresents a major trend in the current evolution ofthe Fund model. More and more, in addition tosecuring diversified finance, training Funds aim atregulating training at both the micro (enterprise)and macro (national) levels, through incentives,direct interventions and dialogue (Atchoarena;Caillods, 1995).

3 A brief review of experience

3.1 Back to the roots: Brazil

The Brazilian vocational education systemBrazil pioneered the establishment of autonomousinstitutions responsible for the training of the man-power required by the economy (CINTERFOR,

1991). Funded by payroll taxes and developed asdistinct from the school system, this model wasconceived as one of the instruments needed to facethe challenges of industrialisation.

The National Industrial Apprenticeship Service(SENAI) was established in 1942 to provide aqualified workforce for the developing industrialsector5. Conceived to serve the needs of theindustry, SENAI is also managed, financed andoperated by industry. It was established by decreebut is regulated under private law.

SENAI adopted a regional structure, partly due tothe size of the country and its federal nature. TheNational Council, headed by the President of theNational Confederation of Industry, comprisesrepresentatives of various industrial sectors, aswell as those of fisheries, transportation and com-munications, officials from both the Ministries ofEducation and of Labour and the Presidents of theRegional Councils.

The National Department is mainly in charge ofproviding overall normative guidance, technicalassistance and co-ordination. The RegionalCouncils have a pattern of membership similar tothe one adopted at the national level. They are theexecutive arms of SENAI and operate thevocational training centres as well as providetraining and related services to the enterprises. Itis to be noted that workers' organisations are notrepresented in the SENAI management bodies.

SENAI's training infrastructure embraces a greatdiversity of elements, including over 500 varioustypes of vocational training centres, more than 200mobile training units and several personnel devel-opment centres. Many of these institutions arejoint ventures operated in co-operation withindustry. Major training activities combine in-centre pre-employment vocational training, anapprenticeship scheme and continuing vocationaleducation, including company-based programmes.This diversified training structure and strategy hasallowed SENAI to train, since 1942, more than 10million people. SENAI's activities are meant tocater for the needs of the modern sector of the

5 A sister institution, the National Commercial Apprenticeship

Service (SENAC), was later set up for the tertiary sector


economy, although the importance of the informalsector is recognised.

It is argued that one of SENAI's major assets is itsclose relationship to industry and its needs. Such aclose linkage is largely due to the financial partici-pation of the employers and to the design of thegoverning bodies of the system. However, co-operation also exists at the operational level wherebusiness representatives are very active, takingpart, for instance, in curriculum development,recruiting apprentices, providing part-time instruc-tors or by participating in the technical advisoryboards of the training centres.

Financing modalitiesSENAI's financing modalities are based on a 1 %payroll tax paid by enterprises from the industry,transportation, communications and the fish-processing sectors. Businesses employing morethan 500 workers are subject to an additional levyof 0.2 %. The tax is collected by the GovernmentAgency in charge of social security, and thentransferred to SENAI. Government subsidiescomplement the budget.

The allocation of funds is governed by the follow-ing principles. SENAI's central administrationabsorbs 1 % of funds raised to cover related costsand further retains 15 % of the general contri-bution for its running expenditures, as well as theproduct of the additional tax. The balance of thegeneral contribution (85 %) is transferred to theregional bodies.

The retention of funds at the central level enablesSENAI to perform a redistributive function byallocating supplementary resources to disadvan-taged regions, such as the Northeast, or to supportpriority programmes. The additional resourceslevied from large companies are mainly used tofinance their training plans. Finally, public subsi-dies benefit programmes linked to governmentpolicies, such as the training of trainers or thebuilding and equipment of new training centres.

In 1975, the revenue-raising scheme was comple-mented by a tax-rebate incentive. This arrange-ment provided training enterprises with the pos-sibility of deducting, within an upper limit, twicethe amount of their training bill from their incometax. The tax rebate was subject to the prior

approval of the enterprise's training plans. Suchan option reflected a Government strategy to boostin-company training, in view of improving labourproductivity. However, it was suspended in 1990for an indefinite period, within the framework ofbroader orthodox fiscal measures.

The effort to promote company training ledSENAI to sign specific financing agreements withlarge enterprises. According to these contracts, thefirm that agrees is exempted from the 1 % levyand is allowed to retain part of the 0.2 %additional tax. Corresponding savings must beallocated to enterprise-based training programmes.These contracts are primarily of benefit to enter-prises making significant investments in areasconsidered as contributing to industrial develop-ment.

Apprenticeship, managed by SENAI, constitutesanother financing modality of training. It is com-pulsory for enterprises to employ, and enrol inSENAI centres, a number of 14 to 18 year-oldapprentices ranging from an equivalent of 5 % to15 % of their ordinary workforce. During the firsthalf of their training, apprentices receive half theminimum wage. This income increases to two-thirds of the base salary for the second part of thelearning period.

The various components of this system are meantto contribute to the development of training.While the levy, complemented by public subsidies,guarantees, under normal circumstances, a certainfinancial stability, the tax-rebate scheme supportsthe expansion of in-service training and increasesthe interest of employers in training. Co-financingagreements and the management of the apprentice-ship system are instrumental in ensuring thatSENAI remains close to the enterprises and theirchanging needs.

What lessons?The evolution and the results of the Brazilianfinancing system provide an interesting overviewof the various financial instruments and strategiesused. The payroll tax has obviously contributed tothe development of a strong training system,focusing on long-term training programmes.However, the allocation mechanisms have notbeen able to operate a redistribution of funds in amanner which significantly reduces the disparities


of access between the various regions, between thesize of the enterprise, and between the category ofworker. In addition, the expansion of the institu-tion is sometimes said to have generated a quasi-monopoly or, at least, given it a dominant position,which has impaired the development of acompetitive training market (Leite, in Gasskov,op. cit.)

The profound crisis that Brazil faced in the early1980s revealed the solidity of the revenue-raisingscheme and its ability to adapt to a changing eco-nomic context. Adverse conditions resulted in afall in revenue as employment and salaries fell. Inconstant price, the contributions collected in 1989represented only 63 % of the 1980 figure. Overthat period, the survival of the institution requiredboth the reduction of expenditures and the diversi-fication of revenues. The interest produced bysurpluses accumulated in the past constituted astabilising income which guaranteed SENAI'sfinancial solvability. Developing closer links withenterprises also contributed towards supplement-ing the decline in the regular payroll-based income(Gomes, 1991).

The results of the tax-rebate scheme showed asignificant increase in company training (2 milliontrainees in 1980), and the development of enter-prise training centres. However, a careful analysisshowed that only 1 % of the taxable companiestook advantage of this device. The heaviness ofthe procedure for approval was sometimes identi-fied as an obstacle to the system. The fiscal incen-tive was, in fact, taken up by the large companiesfrom Sao Paulo, which used it to further consoli-date their training policies. The impact on otherindustrial sectors and states remained limited.Therefore, the tax-rebate facility did contribute toan expansion of the training effort, but in a waythat further increased the training gap betweenregions and categories of enterprises.

The co-financing agreements, conceived as analternative way of developing enterprise-basedtraining, have shown rather positive results, asindicated by a rapid increase in the number ofcontracts. However, this trend has also confirmeda bias towards large firms. Major agreements aresigned with companies having their own training

centre. The participation of smaller companiesremains marginal.

In spite of its limitations (lack of competition, biastowards large companies, lack of adequate incen-tives), the Brazilian system demonstrated a strongcapacity, in a changing labour market, to diversifyits sources of income as well as its provision ofservices to firms. This flexibility and the closelinks established with enterprises are certainly theresult of an appropriate mixture of institutionaland financial arrangements. Administrative inde-pendence, a hybrid status combining privateownership and public mission, a managementstructure, including industrial and governmentalrepresentatives, probably accounted for SENAI'sachievements.

Its prestige explains the wide dissemination of theBrazilian experience all over Latin America andthe Caribbean (Ducci, 1991). However, thispropagation did not purely duplicate the model butadjusted it to specific conditions. Notably, mostof the other institutions of the region depend uponthe public sector, not on industry, and theirgoverning body usually give predominance toMinistries.

In the case of Brazil, future adjustments to thesystem may put more emphasis on incentiveinstruments, as opposed to compulsory ones, inorder to facilitate an evolution of company strate-gies for training and, more globally, for humanresources development (Gasskov, op. cit.) Thebias in favour of big companies also constitutes anissue that calls for increasing attention. Finally,the non representation of labour interests mightresist the evolution of social forces and the trendtowards further democratisation.

Government options in human resourcesdevelopmentMore than anything else, a significant share of theBrazilian workforce remains quasi-illiterate andpoorly skilled. The low education profile of thepopulation constitutes a major obstacle to furthermodernisation and development of the economy(Amadeo et al, in Samoff, op. cit.). A trainingsystem in itself, as sophisticated and effective as itmay be, does not offer an adequate long-termresponse to the needs of human resources devel-opment.


3.2 Financing training in a context of rapidgrowth: Examples from Asia and theIndian Ocean

The Republic of Korea and Singapore: Stateregulation of the labour market througheducational and manpower developmentThe long-term economic performance of theRepublic of Korea and of Singapore is wellknown. A rapid economic growth, a high level ofexports and a low unemployment rate are amongthe signs of such achievements. Labour shortageis also one of the features of this developmentpattern. It is often argued that this success is, to alarge extent, due to non-economic factors, such aslabour market institutions and educational devel-opment. Today, in both countries, there is arenewed commitment to manpower developmentin an effort to move towards a greater volume ofproduction in the area of high technology.

In both countries, technical and vocational educa-tion is based on the solid foundation of a relativelyhigh level of attainment in general education. InKorea, the development of primary educationraised the literacy rate from 22 % in 1945 to 90 %by the early 1960s. It is estimated that in the mid-1980s more than 90 % of young people enteringthe manufacturing sector had had some form ofsecondary education. In Singapore, the post-inde-pendence educational policy immediately focusedon providing free and universal primary educationand on expanding access to secondary level.Today, both countries enjoy a high level of educa-tional development, as reflected in school enrol-ment rates (see Table 2).

In Korea, as in Singapore, the evolution of theeducational and training system is closely linked tomanpower planning and technological moderni-sation. However, while Korea invested heavily inthe development of technical and vocational edu-cation, as a sub-sector of its school system, Singa-pore recently chose to offer, within secondaryschools, a technically oriented course, as part ofgeneral education. In the meantime, external tothe school system, the Vocational and IndustrialBoard, renamed the Institute of VocationalEducation, was restructured in order to focus onthe provision of post-secondary technical andvocational education for students having

completed a minimum of ten years of generaleducation.

In Korea, vocational education is offered at theend of junior high schools. Vocational highschools’ curricula provide a combination ofgeneral education and specialisation in avocational subject. The system comprisesdifferent types of schools according to the numberof skills offered. The vocational sub-sectorincludes a significant number of private schools.The Ministry of Education lays down and controlsstandards in both public and private institutions.

School budgetary allocations are made by theMinistry of Education through local Boards ofEducation. Tuition fees, as well as other contri-butions made by parents' and teachers' associa-tions, also partly contribute to the financingstructure. In response to the Ministry's controlover fees charged, private schools are entitled toGovernment subsidies. In this context, the privatesector is clearly viewed as complementing thesupply of vocational education so that socialdemand can be met. In order to preserve the inter-est of the lower income groups, targeted financialassistance is made in the form of scholarships andfee exemptions.

The Government plans foresee the significantdevelopment of technical education. Long-termdevelopment aims at achieving, by the year 2000,a 50/50 enrolment ratio in vocational and generalhigh schools.

Besides the vocational education stream, Koreaalso operates a vocational training system. Voca-tional training institutes are said to provide a morenarrowly-based skill training to school leavers.Korea's effort to implement a manpower develop-ment framework dates back to 1967 when theVocational Training Act was passed. In additionto public institutions, the Korean training systemalso comprises private vocational training insti-tutes and in-plant training centres.

The administration of public vocational traininginstitutions is co-ordinated by the Korea Man-power Agency (KOMA). The bulk of the cost oftraining in KOMA centres is met by Government.While large companies invest in well funded train-


ing centres providing in-plant training, smallenterprises rely on public sector institutions.

The majority of vocational training is provided bythe private sector. A recent trend has emphasisedthis distribution pattern, reflecting the Governmentpolicy to increase private sector responsibility, inview of fostering a more demand-driven system.

In spite of the size and strength of technical andvocational education and training, certain criticsquestion the content of the programmes. It hasbeen argued that employers and workers do notfully recognise the relevance of technical educa-tion for industrial jobs (You, in Rodgers, 1994).

Apart from meeting the needs of industry, themassive supply of qualified manpower producedby Korean vocational education and trainingsystems may have contributed to maintaining thesalary rate at a moderate level. The stable supplyof qualified and relatively cheap labour is con-sidered to be a major factor in the economy'ssuccess (Park, in Rodgers, op. cit.).

In Singapore, under the restructured scheme,vocational training became the major mode of pre-employment skill development (Cheung, 1994).The Institute of Technical Education (ITE),responsible for the overall training system, is atripartite body with a board which includes theGovernment, employers and trade unions.Through its training institutes, the ITE providespre-employment training to secondary schoolleavers. On average, admission represents about25 % of the school cohort. Besides full-time insti-tutional training, ITE operates an apprenticeshipscheme which was upgraded and expanded in1990.

The promotion of continuing education also formspart of the ITE's missions. In so doing, it hasimplemented various schemes aimed at upgradingthe education and skills of the workforce. Hence,in addition to vocational courses, continuingeducation and training centres provide part-timeevening and weekend academic classes. In 1981,ITE also introduced its "Approved TrainingCentres" scheme, whereby industries are encour-aged to set up their own facilities.

Finally, ITE has also developed a skill-certifica-tion system to encourage skill formation and toimprove information on the market for skilledlabour.

Within this overall framework, Singapore's voca-tional education system is mainly financed by theGovernment. The ITE's operating budget repre-sents approximately 6 % of the total educationalexpenditure.

Parallel to the development of a vocational educa-tion system, mainly school-based in Korea, andexternal to the education sector in Singapore, bothcountries have set up various incentive or com-pulsory mechanisms to promote training inindustry. In the mid-seventies, Korea introducedcompulsory training requirements (Lee, 1985).Under this scheme, firms with over 300 employees(later reduced to 150) had to train a certain per-centage of their workforce, defined for eachindustry by the Ministry of Labour. In 1976, atraining levy was introduced as a penalty for firmsthat did not comply with the mandatory trainingrequirements. A Vocational Promotion Fund wasset up to manage the resources raised by the levy.In contrast to the experience of many othercountries, the levy was initially determined annu-ally on the basis of the estimated training cost ineach industry (25 % of the cost initially, laterincreased to 75 %). The Fund operates under thesole authority of Government, through theMinistry of Labour. Its resources contribute topublic vocational training programmes and to thedevelopment of in-plant training centres. Levy-based funds are now focused on upgrading publictraining institutions.

In the past, the Korean levy system has not provedto be particularly effective in promoting in-planttraining. Although it is said to have contributed,during the 1970s, to fast industrial development, asharp decline in the number of trainees during the1980s raised Government concern. This down-ward trend was largely attributed to the heavinessof the procedure involved in getting training plansapproved, as well as in the calculation of cost datarequired by the initial system. It is argued that,while the levy did not make much difference to thealready strong motivation of the large companiesto invest in training, it failed to have an impact


upon small enterprises. They end up preferring topay the levy and relying on graduates or onpoaching. In this respect, the levy seems to havebeen considered as another tax. Such resultsraised some doubts about the relevance of thestate-led manpower development policy andinstruments. Under-investment in training byenterprises is considered to have contributed toskilled labour shortages in the 1980s. Thisphenomenon may further be aggravated by thereluctance of young people to choose industrialoccupations (Baek, in Gasskov, op. cit.).

In spite of the limitations of Government policy,massive and early investment in human capitalthrough educational development may have con-tributed to an acceleration of the economic growthrate, as announced in the recent theories ofendogenous growth.

In Singapore, a Skills Development Fund wasestablished in 1979 to promote in-plant training.The financial instruments associated with such apolicy include a payroll tax and incentives totraining firms. The originality of the Singaporeansystem lies in the fact that a levy was made onlyon the lower waged workers. Initially, the levyrate was 2 %. In 1980, it was increased to 4 %.Subsequently, a decision was made to restore the2 % rate (1985), and then to decrease it to 1 %.Accordingly, in 1986, the definition of low wagewas inflated to reflect changing economicconditions.

Using the low skilled employees' payroll as a basisupon which to set the levy originally formed partof a broader government industrial strategy torestructure the economy towards a more capital-intensive production system.

In its effort to support company training, the Fundprovides grants on the basis of approved trainingplans. It also promotes special training pro-grammes focusing on the upgrading of workers'skills.

Although the increase in company-based trainingprogrammes has been significant, the Fund experi-ences difficulties in transforming employers' atti-tudes towards training. Small enterprises and lowskilled workers still constitute largely unreached

targets. The bureaucratic procedure which isrequired for grant applications is considered to beone of the obstacles to a more equitable expansionof grants awarded.

In the meantime, requests are being made tointroduce levy exemptions for some categories offirms. These issues may lead to a further refiningof the financial scheme supporting industrialtraining.

Meanwhile, Singapore provides an interestingexperience in the linking of educational and man-power development policies. The 1992 reform, bydelaying vocational education so that it followedon after a minimum of ten years of general educa-tion, reflected an effort to produce easily retrain-able graduates, with a wider educational back-ground. The choice of an out-of-school tripartiteinstitutional framework also indicated a search formore flexibility and partnership. This overallpolicy and organisational shift corresponds to aneffort to move towards a more capital and tech-nology-intensive production.

Training in the transformation of a plantationeconomy: MauritiusIn the 1960s, Mauritius was the archetype of asmall island plantation economy, dominated by thesugar industry. Twenty years later, as a result ofexport-oriented manufacturing together withtourism, a major structural transformation of theeconomy had been achieved, leading to full em-ployment. Inspired as it was by high performingAsian economies, the island's industrialisationstrategy was based on macro-economic stability,the dynamism of the business community, lowsalaries, and on a literate and increasingly skilledlabour force.

Rapid modernisation, however, has led to pressureon wages and labour shortages, while changinginternational conditions have threatened the tradi-tional export market. The emerging context hasrequired increased competitiveness and a sustainedinvestment in human resources development.Education and training are the key elements in thegovernment's strategy to catch up with the bestpractice in international technology. In order toguide educational development up to the year2000, the Ministry of Education has prepared, inclose consultation with all domestic sectors and


the international community, an Education SectorMaster Plan.

In spite of a relatively rapid educational progresssince independence, as reflected in universalprimary education, the educational profile of thelabour force still requires upgrading. For instance,it is estimated that only about half the workforcehas attained secondary level, as compared toapproximately 70 % and 90 % respectively inSingapore and Korea.

Limited access to secondary education - of anunsatisfactory quality - its low level of efficiency,together with an excessive emphasis on exami-nations, are some of the issues faced by theMauritius education system. Indeed, it is felt thatmany vocational programme applicants are inade-quately prepared academically.

As in Singapore, the development of vocationaleducation and training is mainly the responsibilityof a specific institution, external to the schoolsystem. The Industrial and Vocational TrainingBoard (IVTB) was set up in 1988 as a bipartiteparastatal body, associating both public andprivate sectors. The IVTB is responsible for pro-moting, co-ordinating, financing and providingtraining to school leavers, as well as to the existingworkforce (Munbodh, 1995).

Until 1991, the IVTB was under the directresponsibility of the Prime Minister. It now oper-ates under the responsibility of the Ministry ofManpower Resources and Vocational and Tech-nical Training. Applying the principle of partner-ship, the IVTB governing council provides abalance between the private and public sector.However, the act regulating the institution pro-vides that the Chairman of the council shall beappointed by the Prime Minister, while the Vice-Chairman is designated in consultation with theMauritius Employers' Federation. Concern hassometimes been voiced about the non-represen-tation of labour interests. It seems that thepossible evolution of the governing structureremains subject to an improved working agree-ment between the different parties and wouldrequire an assessment of the potential contributionof workers' representatives.

The IVTB operates training centres focusing onareas considered as inadequately covered byenterprises or private institutions. A major targetgroup for long-term programmes are schoolleavers with a minimum of 2 years of secondaryeducation and who are at least 15 years-old.

In recent years, the IVTB has started to providepre-training programmes for pupils having com-pleted primary education. This scheme was imple-mented as a partial response to a growing demandfor an alternative to scarce secondary educationplaces. Providing this type of remedial educationalso reflected the IVTB's concern for the inade-quate academic preparation of applicants due tothe unsatisfactory quality of basic education.However, the IVTB's pre-vocational trainingcentres were conceived as part of a transitionalpolicy. The implementation of the EducationMaster Plan makes provision for a gradual transferof this responsibility back to the Ministry ofEducation, within the framework of the newlyestablished basic secondary schools.

The IVTB also operates a still modest apprentice-ship system, inspired by the German dual model.The apprentices spend about one and a half daysper week in a training centre, the rest of the timebeing devoted to on-the-job training supervised bythe enterprise.

Besides initial training, short-term courses arebeing organised for employed workers. Most ofthem are attended by enterprise-sponsoredtrainees.

Contributing to more transparency of the labourmarket through the greater availability of relevantinformation, and the establishing of a market fortraining, form part of the IVTB's responsibilities.It is with this in mind that the Board is developinga National Trade Certification System leading tothe official recognition of the various levels andtypes of skills. In addition, the accreditation ofprivate training centres and trainers contributestowards monitoring the quality of private trainingand to improving information on the supply side.As a part of this accreditation policy, the IVTBpublishes a directory of registered training insti-tutions and trainers.


Together with the establishment of a trainingBoard, Mauritius has revised the financing oftraining. The current mechanism combines a pay-roll tax together with incentive schemes.

The training levy was defined as a 1 % tax on thebasic salary of all employees, excluding householdworkers, to be paid by all employers into a Fundmanaged by the IVTB. The tax is collected by theNational Pension Fund.

The levy contributes towards covering 50 % of theIVTB's recurrent expenditures and 15 % of itscapital investment, the balance being provided byGovernment.

In order to promote in-plant training, the legis-lation makes provision for a mixed system, com-bining a training grant and a tax rebate. Subject toprior approval of training plans, employers areentitled to a grant as well as to a rebate on taxableprofit, which is equivalent to twice the investmentmade in training. According to this system, theemployers can recuperate up to 75 % of the totaltraining cost. The difference is absorbed by theState (through the tax rebate) and by the IVTB,through reimbursement. As the corporate tax isregulated by a multiple rate regime, the determi-nation of grant allocations varies.

Altogether the IVTB income originates in fivemajor sources: the training levy, Governmentsubsidies, loans and grants, interest on financialreserves, and fees. In addition, the IVTB trainingcentres are required to generate part of their re-current expenditures through fees and sales ofproducts or services. The implementation of thiscost-recovery policy gave contrasting results.Hence, it is estimated that in 1994, institutionsearned between 6 to 30 % of their recurrentexpenditures.

Over the years, the surplus of income overexpenditure has generated important reserves.Such accumulated resources constitute a securityfor the Board in case of a possible reduction ingovernment support or to enable it to maintain andupdate training facilities. This financial pattern ismainly due to the slow expansion of the grantscheme, many employers not having immediatelytaken advantage of the incentive provided by the

reimbursement scheme. It is expected, assuming amore positive attitude on the part of the employerstowards training, that the future development ofthe system will introduce a shift from the revenue-raising component to the grant incentive. Thistrend would eventually lead to a decline in finan-cial surpluses.

As the IVTB is still in a preliminary phase of itsdevelopment, it is too early to assess its impact.Introducing the levy and combining this resourcewith Government money has obviously constituteda sound financial base upon which to establish andexpand the training system. At the same time, theincrease in grant applications reflects the growinginterest of companies in training. However, as hasbeen observed in other similar systems, theprocessing of grant applications represents a sub-stantial amount of work, sometimes leading todetrimental delays.

In the years to come, it is likely that the continua-tion of the trend observed for the grant incentivewill require a review of the existing financingformula. In any case, such a revision will soon benecessary as it is intended that the present three-rate corporate tax structure be replaced by a single-rate regime.

As the employers have indicated their reluctanceto an increase in the tax rate, one of the avenuestowards broadening the income-base might lie inthe diversification of resources. In particular, theIVTB could be led to expand, on a cost-recoverybasis, the range of services it provides to enter-prises.

One of the issues regarding the future develop-ment of the IVTB's activities and funding concernsGovernment plans to further develop technicaleducation. In 1990, a specific body, the Manage-ment Trust Fund, was established to promotetechnical education. Management of the institu-tion is ensured by a board of trustees consisting ofrepresentatives from public and private sectors, theChairman being appointed by the Minister ofEducation. Financing of the Fund is also ensuredby the Ministry of Education.

The Fund, which was mainly responsible for thesole "lycée polytechnique", will be in charge of


two new technical (polytechnic) institutions,designed to develop the education of technicians.Although polytechnic education, inspired by theSingaporean model, is meant to be vocational, itsfuture development will require careful monitor-ing. In particular, its capacity to address theeconomy's requirements for technicians, asopposed to becoming a stepping stone to anengineering degree, remains to be seen.

Finally, in order to obtain an adequate return onthe overall vocational education and traininginvestment, a strengthening of the linkagesbetween the IVTB and the Management TrustFund will be necessary. Furthermore, progress intraining needs to be accompanied by a significantimprovement in the internal efficiency and qualityof basic education. This surely represents a crucialprerequisite in order to succeed in the establish-ment of the standards required by a high perform-ing economy.

3.3 An African experience: Côte d'Ivoire

False hopesCôte d'Ivoire is one of various middle-incomecountries in West Africa. It is viewed as a partnerof major importance in the sub-region, due to itseconomic weight. During the two decades follow-ing independence, its economy enjoyed a relativelyrapid growth. As from the 1970s, however,adverse international conditions in the price ofexport commodities, especially coffee and cocoa,affected the country's development. By the early1980s, the debt level led to a series of structuraladjustment programmes. The fall in real GDPreflected a clear economic decline. This reversalin trend meant a significant contraction in govern-ment revenues and, consequently, in expenditures.Following the 1994 devaluation of the CFA franc,the economy seems to have shown some signs ofrecovery, needing further consolidation. In themeantime, the effects of the long-term deteriora-tion of the macro-economic situation are being feltin all social sectors, including education.

Education: A national priorityIn Côte d'Ivoire, relatively high priority has alwaysbeen given to education. In spite of the economicand financial difficulties experienced by theeconomy, education still represents a significantshare of government expenditures and of the GDP

(see Table 2). Sustained educational effort hascontributed, during the two decades of economicexpansion, to an increase in enrolment rates at alllevels. Over the following period, the crisismarked a set back for most educational indicators.Apart from the economic environment, the rapiddemographic growth constitutes a serious chal-lenge for the education sector, as reflected in a stillhigh level of illiteracy (see Table 1).

Technical and vocational education and trainingare an important part of educational and employ-ment policies, set against a background of declin-ing labour demand, including for graduates. InCôte d'Ivoire, the technical education sub-sectorwas established prior to independence. It hassince experienced a number of structural reforms.The apprenticeship tax was introduced as early as1959.

One of the problems of technical education hasbeen its inability to adjust to a changing labourmarket. Employment in the rural and urban infor-mal sector has gradually become a key variable indetermining the absorption of school leavers,including technical education graduates. As aresult of compressed government spending, addi-tional difficulties were experienced in trying tomaintain teaching quality and equipment.

Innovations in the financing of trainingApart from technical education, the introduction,in 1977, of a payroll tax provided the financialresources and incentives necessary to boost in-service training in the private sector. The systemdeveloped at that time by Côte d'Ivoire constituteda real innovation in the region (Kone, inAtchoarena; Caillods, op. cit.)

The law on the financing of continuing educationprovides that all enterprises in the industrial, agri-cultural and commercial sectors, subject to thecorporate tax, shall pay a training levy equivalentto 1.5 % of their payroll. In practice, a tax rebatereduces the rate to 1.2 %.

The payroll tax was introduced in a relativelyfavourable economic context, before the effects ofthe international crisis were felt. Therefore,employers did not object to what they first con-sidered as additional taxation, without close link-age to training issues. However, consultations and


studies related to the introduction of the new taxwere initiated as from 1974, leading to a wideconsensus in 1977.

In accordance with the law, enterprises had to payhalf of the compulsory contribution into anaccount named the 'National Intervention Fund forVocational Training', managed by the OfficeNational de Formation Professionnelle (ONFP).The ONFP was established in 1966 to supervisepublic vocational training centres, co-ordinatetheir activities, as well as to manage the resourcesof the apprenticeship tax.

The other half could be retained by employers, ifthey financed their own training programmes.This arrangement was meant to provide anincentive for the development of company-basedtraining. However, it was not enforced and so theemployers had to pay the entire tax.

The Fund, later renamed the 'National Fund forRegulation' (FNR), was established as a tripartitebody, under the dual authority of the Ministries incharge of technical education and of finance(Achio, 1993). Members of the FNR board werenominated by their respective constituency andselected by the responsible ministerial authorities,chairmanship being given to an employer's repre-sentative.

Up to 1987, the executive arm of the FNR was theONFP. This institutional framework lacked trans-parency in its allocation of funds, the ONFP beingin charge of both the apprenticeship tax and thepayroll levy for continuing education. It wastherefore decided to give the Fund full autonomy,and to provide it with its own administrative andoperational structure regulated by private law.The employer's chairmanship and the adoption ofprivate sector rules and status for accounting pro-cedures and staff management were supposed toensure the full flexibility of the Fund according tolabour market conditions.

The Tax Department of the Ministry of Financeplays a central role in the organisation of thesystem. It collects the tax together with otherlevies and transfers these sums into an accountopened in the name of the Fund.

The allocation of Funds made provision for amixed system. Firstly, each enterprise acquired adrawing right equivalent to half its compulsorycontribution in order to finance its training plan.Secondly, the other half was kept by the Fund inorder to constitute accumulated resources (mutualfunds) used to finance special programmes aimedat supporting specific sectors or categories ofworkers considered as a priority. Accumulatedresources were instrumental in supporting thepolicy of the Fund to promote training. To thisaim, the FNR regulations also introduced a savingsprinciple, defining a minimum accumulated con-tribution (originally equivalent to 12 months)before an enterprise could claim reimbursement.

Success or failure?The establishment of the FNR, in 1987, led to anincrease in the number of people trained. Thistrend was sustained until 1989-90, the beginningof a liquidity crisis, indirectly linked to the finan-cial problems of the State in a period of structuraladjustment. The continued fall in resourcesrecorded for the 1988-91 period ) reflects theeconomic difficulties and the contraction ofemployment in the modern sector.

It is estimated that between 1985-86 and 1988-89the share of the workforce having benefited fromtraining increased approximately from 5 % to14 %. Such an evolution represents a significantprogress.

Collected data (Atchoarena; Caillods, op. cit.) alsoreflect, up to 1987-88, the development of pro-grammes initiated by the Fund using the accumu-lated resources (mutual funds). Most of themwere allocated to priority sectors, such as agro-industry, mechanical engineering, electricity andtransportation.

Finally, the FNR contributed to establishing amarket for training through accreditation proce-dures for private training institutions. Globally,about 37 % of levy-based resources were allocatedto private training institutions and 34 % tocompany training centres, as compared to onlyapproximately 10 % to public institutions, thebalance having benefited foreign training insti-tutions. In 1988, the establishment of an associa-tion of private training institutions (SyndicatNational des Opérateurs de Formation Continue)


contributed to initiating a self-regulated control ofthe sector and to facilitating dialogue with theFund.

In spite of these achievements, the system did notprove to be sustainable. As from 1989, the finan-cial difficulties experienced by the State did notallow the Ministry of Finance to transfer to theFNR the revenue raised by the levy. As a result,the Fund was unable to meet its reimbursementcommitments to enterprises. This crisis led to thegradual bankruptcy of the system. The FNR waseventually liquidated in 1992.

The apprenticeship taxThe apprenticeship tax, established in 1959, wasrevised in 1966 and, three years later, its rateincreased from 0.3 % to 0.5 % of the sector's pay-roll, including the public civil service. In practice,a tax rebate reduced the rate to 0.4 %. The objec-tives of the tax, which went unmentioned in theinitial law, were clarified by the 1966 reform. Itstipulated that the ONFP should reimburse part ofthe revenue raised by the tax to enterprisessupporting initial training programmes.

Although precise data are lacking, it is estimatedthat only a marginal share of the resourcescollected contributed to the apprenticeship systemor to other forms of initial training. The tax-basedincome was mainly used to cover the recurrentexpenditures of the ONFP. Overturned by its ownbureaucratic practices, it was also eventuallyliquidated in 1992.

Restoring the system: The 1992 reformIn 1992, the Government decided to reform theentire institutional framework for labour marketand training policies. It established a new Fund,named 'Fund for the Development of VocationalTraining' (FDFP), for the financing of training(Niango, in Atchoarena; Caillods, op. cit.). Thenew institution is in charge of the promotion andfinancing of continuing education and apprentice-ship, replacing the FNR and the ONFP.

The major change in the new system concerns thefinancial circuit and the role of the Treasury. Thecollection is still performed by the income taxdepartment but the revenue is no longer trans-ferred to a special Treasury account. Resources

are now directly allocated to an account at thedisposal of the FDFP.

Another important transformation is the transfer ofboth the continuing education levy and theapprenticeship tax to the same Fund, now oper-ating under the sole authority of the Ministry ofFinance. However, the concern for transparencyhas led to the management of the resources undertwo separate accounts.

The closer monitoring of the system by theMinistry of Finance is also reflected in the reformof the governing body of the FDFP. Hence,although the tripartite principle is maintained,chairmanship is now ensured by the Minister orhis representative, and no longer by the employers.In addition, the new Fund operates under publicsector regulations.

The reform also concerned the modalities underwhich enterprises must pay the tax for continuingeducation. They now have the possibility ofretaining 50 % of the tax, corresponding to 0.6 %of their payroll, to finance their own training pro-grammes. These plans are being subject to FDFPapproval. Although this arrangement certainlymeets the demand of one section of the employers,it limits the possibilities of redistribution amongenterprises to the detriment of the smaller ones.

Beyond the technical aspects linked to the finan-cial circuit, the Côte d'Ivoire experience shows thedifficulty of maintaining a financing mechanismbased on a payroll tax in a period of a decline ofthe modern sector. It also raises the issue of con-flicting State priorities in a context of structuraladjustment. To what extent training should thenbe protected remains debatable.

Recent developments will also illustrate the abilityof a Training Fund, by nature designed to serve theneeds of the modern sector, to address the trainingand development requirements of other segmentsof the labour market. Indeed, in 1994, a loanagreement was signed with the World Bank toimplement a project aimed at non-conventionaltargets. The management of this programme willundoubtedly require making innovative adjust-ments in the operational procedures of the Fund.


Population(1993)

GDPper capita

(1993)(US$)

GDP per capita,average annual

growth rate(1980-1993)

Adult literacy rate(1992)

Brazil 156,578,000 2,930 0.3 % 81.9 %Korea 44,508,000 7,660 8.2 % 97.4 %Singapore 2,798,000 12,310

(1990)5.7 %

(1980-90)89.9 %

Mauritius 1,109,000 3,030 5.5 % 81.1 %Côte d'Ivoire 13,397,000 630 -4.6 % 36.6 %

Table 1: Socio-economic indicatorsSources: World Development Report 1995; World Bank; Human Development Report 1995, UNDP

1st levelnet enrol-ment ratio

(1991)

2nd levelnet enrol-ment ratio

(1991)

Share of education in totalgovernment expenditure

Expenditureas % of GNP

Brazil 86 % 16 % - 4.6 %(1989)

Korea 100 %(1993)

88 %(1993)

14.8 %(1992)

4.4 %(1992)

Singapore 107 %(gross)

69 %(gross)

- 3.4 %(1988)

Mauritius 89 % 54 %(gross)

11.8 %(1990)

3.7 %(1990)

Côte d'Ivoire 52 % 24 %(gross)

- -

Table 2: Educational indicatorsSource: Statistical Yearbook 1994, UNESCO

4 Conclusions and further thoughts

4.1 The rationale in briefIt is widely felt that investing in technical andvocational education and training contributes toeconomic growth, as reflected in the abovecountry examples. In particular, this form ofhuman capital formation supposedly facilitatestechnological change and international competi-tiveness.

At the same time, and in spite of the absence ofclear statistical evidence, there is a feeling thatsocieties underinvest in training. This attitude issuspected to be widespread in industry, whereindividual enterprises often tend to preferpoaching skilled workers.

Such so-called "market failures" require publicintervention, although there is strong internationalsupport in favour of the allocation of resourcesthrough market forces (World Bank, 1991). Theissue then becomes to determine how governmentscan best design financing policies in order toimprove the efficiency and effectiveness of tech-nical education and training. Specific aspects con-cern the possibility of defining appropriate cost-sharing arrangements and ways of conceivingeffective incentive structures.

4.2 Major trendsIn spite of their wide economic, social and culturaldifferences, the countries selected here illustratesome of the major trends affecting the financing oftechnical and vocational education and trainingsystems worldwide. Based on the material pre-


viously reviewed, at least four of the above can beidentified:

a) Financial diversificationThis trend is observed in most countries, reflectingeither an effort to shift financing towards a moremarket-driven pattern or to change workers' andemployers' attitude, as reflected in the case studies.This strategy also frequently corresponds to aforced adjustment to shrinking public budgets(Brazil). The introduction of fees and the use ofgeneral or earmarked taxation represent variouspossible market, state or collaborative instrumentsto diversify resources. The examples show thatthere is no pure model, and that financing systemsfluctuate from state to market regulation over aperiod of time within a specific country. The needand/or the wish to diversify finances forms one ofthe main reasons for such fluctuations.

Foreign aid, through grants and loans, also con-stitutes, in many countries, like in the Côte d'Ivoireand Mauritius, a significant element in the initialsupport of the gradual restructuring of nationalfinancing systems.

b) The establishment of training FundsThe performance of Korea and Singapore in regu-lating labour markets cannot be attributed to effi-cient market mechanisms. In trying to understandthese successes, increasing interest is being paid tothe role played by specific social institutions.Among these, Training Funds and Boards deservespecial attention, especially when assuming thatskill development is a precondition for sustainedgrowth.

In most selected examples, the financing systemrelies on a Fund, sometimes incorporated within abroader Board, which plays a central role in theallocation of resources, partly raised by a payrolltax. This institutional arrangement is currently inplace, or being considered, in many developingcountries. The case studies indicate that such aninstitution can constitute a useful interfacebetween the different enterprises and the trainingsystem. It also plays a key role in correctingmarket imbalances in training access.

It is possible to identify three functions performedby Training Funds: banking, mutual funding andinsurance. As in a bank, enterprises can withdraw

from their account funds required to cover theirtraining expenditures: this constitutes the basicfunction of Training Funds. The redistributivefunction, present in many systems, made possibleby the constitution of mutual funds, contributestowards tackling the needs of disadvantagedworkers, enterprises or regions (Brazil, Côted'Ivoire, Singapore). Finally, enterprises facingsudden technological change may be able tobenefit from the Funds' accumulated savings tofinance emergency training programmes. To thisextent, the payroll tax can represent a form ofmandatory savings account, which can offer addi-tional protection to enterprises requiring greatertraining-related financial support at certain stagesof their development.

Over and above administrative and financialaspects, the shaping of National Training Funds isthe result of a complex mixture of economic,social and political forces. Such diversity is fullyreflected in the institutions set up in Brazil, Korea,Singapore, Mauritius and Côte d'Ivoire. A majordifference can be distinguished between institu-tions of a purely financial nature (FDFP) and thosealso involved in training provision (SENAI, ITE,IVTB). Another distinction can be made betweenmandatory but privately managed Funds (Brazil)and publicly managed earmarked tax fundedbodies (Korea, Singapore, Mauritius, Côted'Ivoire). However, while the precise nature ofthese institutions varies, they perform everywherea decisive role in allocating resources for training.The extent to which Funds contribute to the effec-tiveness and efficiency of training provisionremains, however, to be seen.

c) The diversification of services provided by thetraining fundsAs indicated in the examples of SENAI, ITE,IVTB or FDFP, financing, and sometimes trainingdelivery, only represent part of the Funds' activi-ties. Increasingly, they perform other services,such as labour market analysis, the certification ofskills, accreditation of private training institutionsor providing advisory services to enterprises.

Developing a formal system for the recognitionand certification of skills contributes to the greateravailability of relevant information concerning thelabour market. Similarly, supporting and monitor-ing the establishment of a market for training


introduce a demand-driven mechanism for trainingprovision.

Some of these functions are implemented on acost-recovery basis and have thus contributed tobroadening the financial resources of traininginstitutions. Furthermore, it is often argued thatcost-sharing arrangements increase the flexibilityand responsiveness of the training system bybuilding closer relationships between institutionsand enterprises.

d) The emergence of the concept of partnershipGetting together all the institutions involved in thedecisions that affect them is increasingly consid-ered an efficient approach towards improving thefunctioning of training systems. Participation ofstakeholders means giving them the institutionalcapacity to influence policy making and manage-ment as well as to control activities and resources.

Reforming the financing mechanisms must be seenagainst the broader context of redefining theresponsibilities of the main economic agents vis-à-vis technical and vocational education and trainingsystems. Over and above the financial partici-pation of employers by way of the payroll tax andfiscal incentives, public policies also reflect aneffort to modify the role of the state in training andto achieve a new social contract between thedifferent partners involved. In this respect, Train-ing Funds or Boards represent an important locusin forging an agreement between the State,employers and individuals regarding policy issuesas well as their respective role in training. Com-plementary trends concern the participation oflocal governments and NGOs, especially in thecontext of decentralisation and territorial devel-opment policies.

Finally, the challenge of partnership is to ensurethat the main actors involved in the productivesector are committed to the principle of investingin human capital formation, and acknowledge itsimportance for development.

However, partnership does present some costs andrisks. Participation and dialogue involve time. Inpractice, partnership often slows down thedecision-making process. A kind of trade-offoccurs between the adoption of a participatoryapproach and being able to make fast decisions.

Short-term management objectives may favour thehandiness of the system, while a sustainabletraining strategy would require the sharing ofcontrol.

Increasing the number of actors involved is alsosubject to cultural and political limitations. Insome cases, labour representatives may be per-ceived as threats. Therefore, although oftenpraised, increased partnership still encountersmuch resistance.

4.3 Variables affecting funding schemeoptions

National training systems and their financing arethe product of specific historical developments.Therefore, the appropriate mixture of instrumentswill not be the same at all times and all places. Itdepends on many factors, including a country'sadministrative culture and current circumstances.Among more specific variables affecting thefunding formula, the following six deserve par-ticular attention:

a) The structure and the size of the economyThe level of economic development constitutes amajor constraint for the financing system. In par-ticular, the extent to which the State can share thecost of training with other partners is directlylinked to the structure of the economy. If the pos-sibilities of introducing and operating a payroll taxfunded system are high in middle-income andhigh-income countries, it may be more problem-atic in a low-income economy. Below a certainscale the benefits of the levy-based system arenecessarily limited due to the impossibility ofinitiating an accumulation process.

In this respect, it must be underlined that the pay-roll-tax system is tailored to address the needs of amodern economy. Its capacity to consolidate skillsin the informal sector is minimal.

b) The economic policyThe role of the State in the economy has an influ-ence on financing policies. Financial diversifica-tion corresponds to an era dominated by a globalshift to a market economy. In many countries,such a predominant strategy also forms part of abroader response to an unprecedented fiscal crisis.


However, under certain circumstances, financingstrategies for training may contradict economicpolicies. It is notably the case in the use of payrolltaxes in a context of fiscal austerity. Indeed, taxa-tion becomes a sensitive issue in a process of eco-nomic liberalisation, when resource allocation isincreasingly meant to be driven by market signals.Facing the pressure for more fiscal orthodoxy, theuse of payroll tax, as compared to general taxation,can appear questionable.

c) The maturity of social partners vis-à-vistrainingThe performance of a given financing system willvery much depend on the attitude of individualsand employers regarding training. For instance,the case of Korea illustrates the difficulty faced byan incentive structure when individual employersare not always convinced of the need to invest intraining and sometimes prefer poaching skilledworkers (You, in Rodgers, op. cit.). Similarly,providing incentives to individuals also necessi-tates access to relevant information on trainingoptions, costs and returns.Therefore, the reform of the financing systemrequires, as much as possible, a wide consensusbetween all of the partners involved: government,employers, workers, students, parents, publictraining institutions and the public at large.

The introduction of a payroll levy may be viewedby employers as just another tax. Making themaware of the associated incentives and of thepotential impact of training on labour productivitymay call for intensive and long periods of consul-tation. In Côte d'Ivoire, the preparatory work wasinitiated three years before the actual introductionof the payroll tax.

Introducing fees often requires similar preparatorywork in order to convince individuals, and some-times heads of institutions, that cost-sharing isnecessary and, under certain conditions, equitable.

Incentive structures for investing in training arebased upon the assumption that the willingnessand strategy of firms and individuals dependlargely on the cost factor. This statement may bechallenged. When making investment decisions intraining, enterprises may take into account anumber of elements, including the business cycle,technological change and also industrial relations.

Nevertheless, reforming the financing systemcertainly constitutes a way of changing the attitudeof the various actors. In many countries (Côted'Ivoire, Mauritius, Singapore), medium- or long-term perspectives reflect a clear evolution ofinvestment strategies in training, much of itprobably resulting from the implementation offinancial instruments. Reforming the financingprinciples can therefore also be part of a proactivelong-term government strategy.

d) The state of relationships between thepartners involvedHighly conflicting situations are hardly conduciveto positive dialogue. They are more likely to leadto hostile confrontation. It is obviously difficult tomanage a training system under such conditions.A pragmatic approach to this problem might meanthe exclusion of certain parties from the governingbody of the Funds (Brazil, Korea, Mauritius).

It could also be argued that the full participation ofthe social partners in labour institutions, includingTraining Funds, can contribute to the collectiveorganisation of the various parties and later facili-tate training-policy dialogue with government.Current developments taking place in someAfrican countries (Bénin, Mali) seem to followthis rationale. Their full effect remains to be seen.

e) Institutional capacity to enforce, manage andcontrol the systemIn order to be effective, financial diversificationpolicies must benefit from a strong institutionalframework. This is especially the case for payrolltax that requires a reliable administrativemachinery to ensure that tax recovery is effective.Payroll taxes are usually collected by the IncomeTax Department of the Ministry of Finance,together with other company taxes, or by thenational insurance scheme, which already raisessocial contributions. In both cases, a sound insti-tutional capacity to collect an additional tax isrequired.

The performance of a Training Fund depends inpart on its administrative cost. The selected expe-riences indicate that the operation of a tax rebateor reimbursement schemes requires extensiveprocessing for grant or exemption applications.Often, malfunctioning bureaucracy leads to


delayed payment and to a loss of confidence in thesystem (Côte d'Ivoire).

Regulating the training market by issuing accredi-tation to private institutions (Côte d'Ivoire, Mauri-tius) also implies some sort of bureaucracy.Government control of standards and outcomes isrequired to ensure that public funds are used inconformity with their initial objective.

In reality, the true administrative cost is practicallynever measured. Hence, costs incurred by collect-ing taxes are not accounted for, the job being doneby the Ministry of Finance or the national insur-ance or pension scheme.

Depending on the magnitude of economies ofscale, the average cost would be relatively lowerfor large systems, given the number of contribut-ing enterprises. In small, low-income countries,lacking strong taxing and regulatory capabilities, asimple financing system would minimise collec-

tion, record-keeping, pay-out and other adminis-trative costs.

Although it would be harmful to establish a linkbetween legal status and administrative efficiency,experience has shown that, in certain environ-ments, publicly managed Funds run a higher riskof encouraging wasteful spending (e.g. ONFP,Côte d'Ivoire).

f) The objectives of the financing systemThe objective can be either to raise funds fortraining or to change attitudes. In some cases,objectives go beyond the training issue to affectfurther dimensions, such as the choice of tech-nology (Singapore).

A distinction can be made between the systemsbased upon compulsory requirements and thoseusing incentive instruments. The review of objec-tives and instruments provides an interestingfeature of national financing systems:

Objective

Instrument

Promote company-basedtraining

Build-up atraining system

Influenceenterprises'labour policies

Regulate thetraining market

Compulsoryrequirements

• Republic of Korea • Brazil• Singapore• Mauritius

• -• Mauritius• Côte d'Ivoire

Incentives • Brazil• Mauritius• Côte d'Ivoire

• -• Singapore • Mauritius

• Côte d'Ivoire

Major features of selected financing system

Incentive structures are based on a tax rebate(Brazil, Mauritius) or a training grant (Mauritius,Côte d'Ivoire). Compulsory instruments usuallytake the form of a payroll tax; less frequent is theenforcement of a quota for training (Korea).

Government resources are usually used to financea public system for technical education or voca-tional initial and continuing training (Korea,Singapore, Mauritius, Côte d'Ivoire). They arealso used to support programmes designed for dis-advantaged groups (Brazil, Côte d'Ivoire).

Over and above these specific objectives, trainingsystems, and their financing, can be consideredwithin a macro-economic and educational per-spective. For instance, financing training can bepart of a public policy aimed at reducing investors'risks. It is notably the case in export-oriented

countries operating with a long-term vision, suchas Singapore or Mauritius. In such cases, trainingserves broader industrial policy goals involving,besides incentive instruments, substantial Statefinancing to develop certain skills and establishpowerful publicly financed training institutions.

In another context, heavy investments in trainingcan be viewed as an effort to compensate for thelow quality of basic education (Brazil).

4.4 Issues for debate

How to prevent the diversion of resources?Training Funds, especially when they enjoy sub-stantial financial surpluses (Côte d'Ivoire, Mauri-tius, Singapore), constitute a hidden and exclusivesource of income. As such, they represent atempting prey for a government budget under


pressure, especially when they are publiclymanaged. Past experience in Côte d'Ivoireprovides clear evidence of that risk. A relevantresponse might be to enforce by law the Fund'sautonomy and thus reduce the control of thegovernment's Income Tax Department over theresources collected. However, it is difficult tofully prevent such a crisis, especially when thegovernment is faced with growing budgetary con-straints.

Part of the problem lies in the dualistic nature ofpayroll taxes. Their fiscal origin justifies con-sidering them as public money. Yet, their ear-marked destination and the fact that they are beingpaid and partly managed by employers tend to leadto their assimilation as private funds.

As the concept of earmarked taxation is alien toorthodox fiscal doctrine and often contradictory tofundamental public finance principles, it is diffi-cult to establish legitimately a complete separationbetween payroll-generated income and the Statebudget. In many African countries, this partlyexplains why the apprenticeship tax is, in fact,never used to finance training but allocated toother, less clearly defined purposes.

Training versus employment?Although macro-economic empirical evidence isstill lacking for training levies, common sense tellsus that high payroll taxes mean fewer jobs. Insome countries, like Brazil, taxes for pensions arealready over 25 % of gross wages. Adding addi-tional taxation to this already massive burdencannot be considered as an incentive for creatingemployment. This problem is found in industrialand developing countries alike.

Furthermore, it is argued that the growth of theinformal sector labour force is partly due toexcessive payroll taxes. Hence, evasion not onlyundermines the sustainability of the financingsystem but also affects the structure and competi-tiveness of the economy, labour productivity beingusually lower in the informal sector.

Does financing training help the poor?Heavy investments in technical and vocationaleducation and training often correspond to a policyfor democratising education and broadeningtraining opportunities. In addition to expanding

secondary education by developing vocationaltracks, or providing alternative, non-formal formsof education, this policy has also led to compen-satory government programmes. These schemes,sometimes supported by industry, are aimed atdisadvantaged groups in the labour markets. Earlyschool dropouts, minorities, and informal sectorworkers, often form part of these targeted popu-lations. Such training schemes also constitute animportant component of poverty-alleviationpolicies or "active" labour-market programmes.

The rationale inspiring these policies seems soundagainst a background of high structural unemploy-ment: providing the jobless with the skillsrequired by the economy should improve thelabour market situation. Similarly, if one acceptsthat wages are linked to labour productivity, totrain people for qualified jobs should contribute toreducing poverty.

In reality, the results of these policies are mixed,and often disappointing, especially in periods ofhigh unemployment. Can, and should, govern-ments really finance training on a large scale inorder to address efficiently the issues of un-employment and poverty? In spite of the fact thatthere is little empirical evidence to support suchintervention, such questions remain open. Someargue that, taking into account the high cost oftraining, social objectives and equity would bebetter addressed by improving the overall educa-tional level of the population through increasedinvestment in basic and general education(Carnoy, 1994). Improving the "trainability" ofpeople through higher quality education wouldeventually diminish training costs, especially asthe science and technology content of generaleducation is on the increase (Caillods;Göttelmann-Duret; Lewin; forthcoming).

Financing training revisited: is the classicalcost-sharing pattern still valid?It seemed fair to consider that enterprises shouldcontribute towards the direct financing of work-related education and training. This basic demar-cation between general education, on one side, andtechnical and vocational education and training, onthe other, has long served, with some variations, asthe guiding mark in defining financing responsi-bilities and mechanisms.


While general education increasingly includestechnological contents, the requirement of voca-tional skills tends to become less applicable tospecific, narrowly defined, occupations. The useof similar technologies across a variety of sectorsconstitutes a major factor explaining this shiftaway from job-specific abilities. In addition, theprogressive transformation of work organisation,relying less on the principles of Taylorism than itused to, increasingly involves workers in processimprovement and quality control. Although thistrend may be mainly affecting capital and knowl-

edge-intensive industries, it already has a strongimpact on the way skill formation and industriallearning are being addressed, and financed.

In the long run, the continuation of this tendency,and its dissemination to an increasing number ofcountries, as a result of intense internationalcompetition, may require reconsidering theconcept of technical and vocational education and,therefore, reassessing the premises underlying theclassical financing paradigm.

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CINTERFOR, ILO. 1991. "Vocational training on thethreshold of the 1990s", PHREE Background PaperSeries, Document No. PHREE/91/35. Washington,D.C.: World Bank.

DE MOURA CASTRO, C. 1995. "Training policies for theend of the century". New trends in technical andvocational education. Paris: UNESCO/IIEP.

DOUGHERTY, C. 1989. "The cost-effectiveness of nationaltraining systems in developing countries", PPR WorkingPaper Series, WPS 171, Washington, D.C.: WorldBank.

DOUGHERTY, C.; TAN, J. P. 1991. "Financing training,issues and options", PRE Working paper series,WPS716. Washington D.C.: World Bank.

DRAKE, K. 1991. "Interventions in market financing oftraining in the European Community", in Ryan, P. (ed.).International comparisons of vocational education andtraining for intermediate skills. The Falmer Press.

DRAKE, K.; GERME, J. F. 1995. Financing continuingtraining: What are the lessons from internationalcomparison? Berlin: CEDEFOP.

DUCCI, M. 1991. "Financing vocational training in LatinAmerica", Training discussion papers, No. 71. Geneva:ILO.

GASSKOV, V. 1994. Alternative schemes of financialtraining. Geneva: ILO.

GOMES, C. 1991. "Alternatives in vocational educationfinance: an example of participation by employers inBrazil", Training and discussion papers, No. 69.Geneva: ILO.

GOMES, C. 1991. "Financement de l'enseignementprofessionnel: un exemple de participation desemployeurs au Brésil", Perspectives, Vol. XXI, No. 3.Paris: UNESCO.

GREFFE, X. Forthcoming. "La mise en place des formationsinitiales en alternance: enjeux, problèmes et solutions".Nouvelles tendances dans l'enseignement technique etprofessionnel. Paris: UNESCO/IIPE.

GRÜNEWALD, V.; SAUTER, E. 1990. "L'analyse desstructures de coût et de financement de la formationprofessionnelle continue", Formation Professionnelle,No. 2. Berlin: CEDEFOP.

HALLAK , J. 1990. "Investing in the future: settingeducational priorities in the developing world". Paris:UNESCO/IIEP; Oxford: Pergamon Press.


HEGELHEIMER, A. 1986. Financing of vocational training,German Foundation for International Development(DSE).

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WHALLEY , J.; ZIDERMAN, A. 1989. "Payroll taxes forfinancing training in developing countries", PPRWorking paper series, WPS141. Washington, D.C.

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World Bank. 1991. "Vocational and technical educationand training", A World Bank Policy Paper.Washington, D.C.: World Bank.

Public Expenditure on Education Page 51

Table: Public Expenditure on EducationSource: UNESCO, Statistical Yearbook 1995, tables 4.1 and 4.3

Educationalexpenditure

Total Voca-tional

Country Year

Africa

Botswana6 1991 8.2 18.7 5.5

1992 7.5 14.8 ...

Cameroon7 1990 3.4 19.6 ...

1991 3.0 16.9 ...Ethiopia 1992 5.1 11.9 ...

1993 6.4 ... 0.9Ghana 1989 3.5 24.3 ...

1990 3.1 24.3 4.9Mauritius 1985 3.8 9.8 1.2

1990 3.7 11.8 ...North AmericaCanada 1991 7.4 ... ...

1992 7.6 14.3 ...Costa Rica 1992 4.5 21.4 ...

1993 4.6 20.2 86.7Mexico 1992 4.9 ... ...

1993 6.0 ... 96.0United States of America 1985 4.9 15.5 ...

1990 5.3 12.3 ...South AmericaArgentina10 1992 3.1 15.7 ...

1993 3.3 12.4 ...

Chile11 1992 2.8 12.9 ...

1993 2.7 ... 5.7

Colombia12 1992 3.1 ... ...

1993 3.5 12.3 ...Ecuador 1992 2.7 19.2 10.0

1993 3.0 ... ...Uruguay 1991 2.9 16.6 ...

1992 2.8 15.4 10.5

6 For 1992, expenditure of the Ministry of Education only7 Expenditure of the Ministry of Education only8 Expenditure of the Ministry of Education only9 Expenditure of the Ministry of Education only10 For 1990, expenditure of the Ministry of Education only11 For 1990, expenditure of the central government only12 Expenditure of the Ministry of Education only

AsiaBangladesh13 1991 2.2 11.3 ...

1992 2.3 8.7 2.3China 1992 2.0 12.2 ...

1993 1.9 12.2 ...India 1991 3.8 11.9 ...

1992 3.7 11.5 ...

Indonesia14 1992 2.2 ... ...

1993 1.3 ... 8.3Israel 1990 5.8 10.5 14.6

1991 5.8 10.6 14.6Japan 1990 4.7 16.5 ...

1991 4.7 16.6 ...

Jordan15 1992 3.9 9.1 ...

1993 4.6 11.6 1.8

Malaysia16 1992 5.5 16.9

1993 5.1 ... 2.9

Nepal17 1991 2.7 12.3 ...

1992 2.9 13.2 3.5

Pakistan18 1990 2.6 ... ...

1991 2.7 ... ...

Philippines19 1992 2.3 ... ...

1993 2.4 ... ...Singapore 1980 2.8 7.3 5.1

1985 4.4 ... ...EuropeFrance20 1992 5.7 ... ...

1993 5.8 ... ...Germany, Fed. Rep. of 1990 4.0 8.6 ...

1991 4.1 11.6 ...Norway 1991 7.9 14.1 ...

1992 8.4 13.6 ...Sweden 1991 8.0 14.0 ...

1992 8.3 12.6 ...United Kingdom 1990 4.9 ... ...

1991 5.2 ... ...OceaniaAustralia 1990 5.4 14.8 ...

1991 5.5 14.1 ...

Fiji 21 1991 4.9 ... ...

1992 5.6 18.6 ...... = data not available

13 Expenditure of the Ministry of Education only14 For 1993, expenditure of the Ministry of Education only15 For 1992, expenditure on third level education not included16 Expenditure of the Ministry of Education only17 "Regular" and "development" expenditure18 Not including expenditure on education by "other ministries"

which are not directly related to education19 Expenditure of the Ministry of Education only20 Metropolitan France21 Expenditure of the Ministry of Education only

UNEVOC Publications Page 53

UNEVOC Publications

1 General information about UNEVOC .................................................................................. 54

2 Studies on Technical and Vocational Education.................................................................. 54

3 Studies on Technical and Vocational Education in the Arab States.................................. 55

4 Systems and Policies ............................................................................................................... 56

5 Co-operation with the Private Sector................................................................................... 58

6 Girls and Women .................................................................................................................... 58

7 Curriculum.............................................................................................................................. 58

8 Training Technologies ............................................................................................................ 59

9 Financing ................................................................................................................................. 60

10 Vocational Guidance............................................................................................................. 60

11 Information, Communication and Networking ................................................................. 60

12 Miscellaneous ........................................................................................................................ 60

Order Information...................................................................................................................... 62

This list of UNEVOC Publications has been prepared by UNESCO's UNEVOC Implementation Unit in Berlin.

Its latest update is available on the WorldWideWeb:http://www.unevoc.de

The latest version in printed form may also be requested from:

UNESCO-UNEVOC • Fehrbelliner Platz 3 • 10707 Berlin • GermanyFax: [+49] (30) 86 49 15 41 • Electronic Mail: [email protected] or [email protected]

UNEVOC Publications

1 General information about UNEVOC

UNEVOC INFOQuarterly, published in English, French and Arabic, 8 pages.

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UNESCO’s International Project on Technical andVocational Education - UNEVOC in briefEnglish, French (Le Projet international pour l'enseignement technique etprofessionnel de l'UNESCO - UNEVOC en bref), German (Das InternationaleBerufsbildungsprojekt der UNESCO - Kurzportrait), Brochure, 2 pages,UNESCO/UNEVOC Berlin 1996, Document No. ED/IUG/009.

This is a brief description of the origins, objectives, strate-gies and network of UNEVOC. It serves as an initial orien-tation to the UNEVOC Project. Multiple copies can berequested and distributed by interested parties.

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UNEVOC Directory/ Répertoire UNEVOCA world-wide Directory of UNEVOC Centres andUNEVOC Associate CentresEnglish/French, ca. 70 pages, UNESCO/UNEVOC Berlin, first published in1995, updated several times a year. Document No. ED/IUG/001.

UNESCO invited its Member States to nominate relevantnational institutions in technical and vocational education tobecome UNEVOC Centres. The Directory provides infor-mation on UNEVOC Centres and related organizations andinstitutions. The present version includes data on 148national institutions, among them 99 UNEVOC Centres and43 UNEVOC Associate Centres, from 99 Member States ofUNESCO. Data of 3 international and 8 regional institutionsare also included.

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UNEVOC Inventory/ Inventoire UNEVOC.An Overview of UNEVOC Activities 1992-1996English/French, ca. 70 pages, UNESCO/UNEVOC Berlin, first published in1995, updated several times a year. Document No. ED/IUG/010

The Inventory consists of two parts: Part 1 provides anoverview of activities that have been carried out withinUNEVOC since its inception. Part 2 indicates the involve-ment of countries and individuals in the various UNEVOCactivities.Its purpose is to inform decision-makers of the broad cover-age of UNEVOC, and of its potential within the area of tech-nical and vocational education.


Feasibility Study on the Establishment of anInternational Centre for Technical and VocationalEducationEnglish, French and German, 21 pages, UNESCO 1991

Based on a resolution I.21 adopted by the General Con-ference of UNESCO at its 25th session in 1989, a FeasibilityStudy on the Establishment of an International Centre forTechnical and Vocational Education has been carried out. Inthis study, UNESCO’s activities in technical and vocational

education is reviewed. The roles of UNESCO and ILO intechnical and vocational education are elaborated. Perspec-tives for future areas of action are developed. Thought isgiven to the possible establishment by UNESCO of an Inter-national Centre for Technical and Vocational Education.Based on this Feasibility Study, the General Conferencedecided, at its 26th session in 1991, to launch the UNEVOCProject.


Final Report of theUNEVOC International Advisory Committee(First Session, Berlin, Germany, 20-22 September1993)English and French, 20 pages, UNESCO Paris, 1993.


Final Report of theUNEVOC International Advisory Committee(Second Session, Paris, France, 12-14 December1994)English and French, 29 pages, UNESCO Paris, 1994.


Final Report of theUNEVOC International Advisory Committee(Third Session, Paris, France, 2-4 October 1995)English and French, 28 pages, UNESCO Paris, 1996.

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2 Studies on Technical and VocationalEducation

Studies #1 Policies and Guidelines for Educational andVocational Guidance

By D. Stuart CongerEnglish, 62 pages, UNESCO Paris, 1994. Also available in Chinese.The study is a resource document for use in planning thevocational guidance programme. It provides examples forthe goals and essential elements of a policy on guidance;descriptions of major components of a guidance programmeincluding curriculum-based career guidance, individualcareer planning, counselling service replying to students'needs, etc. It outlines the responsibilities for guidance on thepart of educational administrators, counsellors, and teachers.Career development competencies recommended forstudents and for adults in terms of self-knowledge, educa-tional and occupational exploration, and career planning areillustrated in detail. The study also briefly describes thedevelopment of career portfolios by students, guidance inwork experience programmes, job search training, peercounselling. The "marketing" of guidance, a statement ofethical principles, guidelines for counselling girls andwomen and the training of counsellors are included as well.

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Studies #2 New Training TechnologiesBy A. Herremans


English, 98 pages, UNESCO Paris and ILO International Training Centre(Turin, Italy), 1995. Also available in Chinese.This document discusses the reasons why new training tech-nologies (NTT) may be used in technical and vocationaleducation and training and provides information on howNTT can be used in group and individual learning. Amethodology is then suggested to select the most appropriateNTT for a particular curriculum or course. It also offerspractical hints for introducing NTT in a training institutionand foresees technical trends for the next few years, in orderto help the administrators and teachers in technical andvocational education make the best possible investment.

Out of print.

Studies #3 A Guide for Evaluation of Technical andVocational Education Curricula

By L. KennekeEnglish, 142 pages, UNESCO Paris and ILO International Training Centre(Turin, Italy), 1995.The purpose of this guide is to help people evaluate technicaland vocational education curricula. It describes the purpose,objectives, organization and concepts of evaluation. Thedocument contains description of procedure, checklists andforms which can be used to conduct evaluation of compre-hensive curricula. It can assist evaluators to collect, analyzeand report information for surveying attitudes, observingprogrammes or measuring achievement. Four case studiesillustrating evaluation of specific curricula are also includedfor reference.


Studies #4 New Perspectives on AssessmentBy R. McDonald, D. Boud, J. Francis and A. GoncziEnglish, 45 pages, UNESCO Paris, 1995. Also available in Chinese.Assessment is vital in vocational education. Today newchallenges have arisen in this field which traditionalapproaches are failing to address. This study highlights fourissues: a) the connections between assessment and learning;b) the need to focus on competence; c) recognizing compe-tence attained outside formal learning situations; and d)assessing across many institutions. The study illustrates bothconcepts and practical measures in this field and is valuablefor both policy-makers and practitioners of technical andvocational education.


Studies #5 Functional Literacy, Workplace Literacyand Technical and Vocational Education:Interfaces and Policy Perspectives

By H. S. BholaEnglish, 60 pages, UNESCO Paris, 1995.All societies develop suitable institutional arrangements forthe delivery of "Education and Training for Work" in orderto reproduce a skilled labour force for their socio-economicdevelopment. This study analyses concepts, curriculum,delivery pattern, assessment etc. of three programmeformats: functional literacy, workplace literacy and techni-cal/vocational education, as well as interactions betweenthem. The policy perspectives on education and training forthe world of work is also presented by the author.


Studies #6 Vocational Guidance for Equal Access andOpportunity for Girls and Women inTechnical and Vocational Education

By J.V. Miller and L. VetterEnglish, 102 pages, UNESCO Paris, 1996.This is the final report of a survey conducted in 10 countriesin various regions of the world. It reviews the current statusof vocational guidance programmes available for girls andwomen including national policy, legislation, funding, pro-gramme settings, evaluation etc. in these countries. Theauthors synthesize the finding and present the trends andfuture orientations in this field. A set of national strategiesto improve career guidance programmes is also recom-mended based on the results of this extensive survey.


Studies #7 Promotion of the Equal Access of Girls andWomen to Technical and VocationalEducation

English, 260 pages, UNESCO Paris, 1996.This monograph collects the Final Report of the "UNEVOCInternational Expert Meeting on the Promotion of the EqualAccess of Girls and Women to Technical and VocationalEducation" held in Seoul, Republic of Korea in July 1995and the country discussion papers submitted by the partici-pants of this event. Factors determining the orientation ofgirls and women towards technical and vocational education,present measures and future strategies in those 14 partici-pating countries from various regions of the world to pro-mote the equal access of girls and women to this type ofeducation are reviewed and summarized.


3 Studies on Technical and VocationalEducation in the Arab States

Studies #A1 Coordination between EducationalInstitutions and Enterprise for Training inBahrain, Jordan and Lebanon

By A. Abu-Kabeer, A. Atwan, E. Al-Safadi and M. HodibArabic, 200 pages, UNESCO/UNEDBAS Amman, 1995.The document includes three case studies on cooperationbetween Educational Institutions and Enterprise for Trainingin three Arab Member States (Bahrain, Jordan and Lebanon).A proposed regional action plan was prepared on the subjectby Mr. Ali Nassrallah (Jordan) and Mr. Sulieman Sulieman(UNESCO Office, Amman, Jordan) to assist Member Statesin the adaptation of mechanisms for cooperation betweeneducational institutional institutions and the world of work.

An English summary of the document will be availableshortly.

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Studies #A2 The Role of TVE in the Educational Systemsof Iraq, Libya, Mauritania, Syria, Tunisiaand the Regional Synthesis

By M. Joma'a, A. Al-Bishti, A. Wild Dahah, S. Mohammed,S. Gherissi and A. AtwanArabic, 300 pages, UNESCO/UNEDBAS Amman, 1995. An Englishsummary of the document will be available shortly.The document includes case studies on the role of TVE inthe educational systems of five Arab Member States (Iraq,

UNEVOC Publications

Libya, Mauritania, Syria and Tunisia) and a regionalsynthesis.


Studies #A3 Policy and Legislation for Technical andVocational Education to EnhanceCooperation with the World of Work

By M. Hijazi, O. Sharafi and N. HizamArabic, 200 pages, UNESCO/UNEDBAS Amman, 1995.The document includes studies on policy and legislation forTVE to enhance cooperation with the world of work in threeArab States (Egypt, Sudan and Tunisia). The studiesfocused on how policies and legislation could be activated inthe development and improvement of TVE programmes, inparticular to increase linkages with the world of work.An English summary of the document will beavailable shortly.


4 Systems and Policies

Convention on Technical and Vocational EducationEnglish and French, 4 pages, UNESCO/UNEVOC BerlinThis Convention on Technical and Vocational Education hasbeen adopted by the General Conference of UNESCO at its25th session in 1989. It provides a set of guidelines for tech-nical and vocational education policy. Its articles cover thescope of the convention (Article 1), objectives and principlesof technical and vocational education (Article 2), Contentsand structures of technical and vocational education (Article3), development and improvement of technical and voca-tional education (Article 4), personnel (Article 5), and inter-national co-operation (Article 6). Articles 7- 15 refer totechnical and legal questions.The convention has been drawn up in Arabic, Chinese,English, French, Russian and Spanish. The English and theFrench texts are available as separate documents.


Final Report of the International ConsultationMeeting on the Role of Technical and VocationalEducation in Educational Systems(Turin, Italy, 14-18 June 1993)English and French, 20 pages, UNESCO Paris, 1993.The Report summarizes the relevant information provided inthe country reports submitted by the participants from 9countries. The issues pertaining to the role of technical andvocational education in the educational systems and in theprocess of socio-economic development are discussed suchas the linkage between technical and vocational educationand the world of work, technical and vocational education asan integral element of general education and a life-longprocess, making technical and vocational education moreattractive, improving the participation of women and otherspecial groups in technical and vocational education, etc. Aset of guidelines for future case studies is recommended forthe follow-up activities, within the framework of theUNEVOC Project.


The Challenge of the Future. Future Trends inAdult and Continuing Technical and Vocational

Education. An International Symposium(Berlin, Germany, 16-20 October 1995)English, ca 100 pages, UNESCO/UNEVOC Berlin 1996. Document No.ED/IUG/008.This report presents the varying perspectives of the partici-pants of the Symposium of possible future changes in themultitude of factors that are likely to impact on the develop-ment of adult and continuing technical and vocationaleducation. The Symposium was designed to assist the worldof adult and continuing technical and vocational education todefine these changes and suggest positive ways of respond-ing to them. The Report includes the individual papers thatwere presented by participants, and a summary of the discus-sion and debates, and of the recommendations. Its appendi-ces include documents related to the particular Symposium,and to technical and vocational education in general.

Request for copies: � (in press)�

Final Report of the Regional Symposium forPolicy-Makers in Technical and VocationalEducation (Dakar, Senegal, 21-24, August 1995)English, French, 25 pages, UNESCO/BREDA Dakar, 1995.This report summarizes the views expressed by the partici-pating policy-makers on the current status of technical andvocational education in the African region. The impact ofthe persistent economic crisis, under-employment, un-employment and the technological progress on the furtherdevelopment of this sector of education was also discussedduring the meeting and reported by this document.


Technical Education in Nigeria: The Way Forward.Summary of Proceedings of the Workshop on"Technical Education - A Foundation for a HealthyEconomy"(Ota, Ogun State of Nigeria, 1-2 March 1994)English, 80 pages, Lagos 1994.This document summarizes the proceedings of a workshopthat was organized by the Nigerian Ministry of Educationand Youth Development in collaboration with UNESCO -through the UNEVOC Project - and Dornier InternationalLogistics.

Out of print�

Le développement de l'enseignement technique etprofessionnel en Afrique:Une synthèse d'études de casFrench, 455 pages, UNESCO/BREDA Dakar, 1996.This document consists of two series of case studies. Thefirst series describes the role of technical and vocationaleducation in the education systems of Cameroon, Congo,Ghana, Kenya, Madagascar, Nigeria and Zimbabwe. Thesecond series deals with policy and legislation to promoteco-operation between technical and vocational education andthe world of work; it covers Burkina Faso, Côte d'Ivoire,Senegal, Swaziland and Uganda. Information from Guinea-Bissau and Cap Verde has been included as well. A synthe-sis elaborates the similarities and differences among thesituations found in those countries.


English version in press.


�

Final Report of the Regional Symposium forPolicy-Makers in Technical and VocationalEducation in the Arab States(Tunis, 24-28 April 1995)Arabic, 49 pages, UNESCO/UNEDBAS Amman and Tunisian NationalCommission for UNESCO, 1995.The objectives of the symposium were to increase the effi-ciency of TVE programmes within the educational systemsof Member States in the Region and link such developmentto the world of work. Discussions during the symposiumincluded the following topics: the role of TVE in educationalsystems; policies and legislation for TVE to enhance coop-eration with the world of work; planning and administrationof TVE to promote the access of girls and women in thisfield; regional and international cooperation on policy issues.The report also includes a set of recommendation on topicsof discussion.


A French summary of the report can be obtained from:Director, Ecole Supérieure des Sciences et Techniquesde Tunis, 5 Avenue Taha Hussein, 1008 Montfleury,Tunis, Tunisia.

�

The Role of Technical and Vocational Education inthe Educational Systems of Iraq, Libya, Mauri-tania, Syria, Tunisia and the Regional SynthesisBy M. Joma'a, A. Al-Bishti, A. Wild Dahah, S. Mohammed,S. Gherissi and A. Atwan

Cf. page 55�

Policy and Legislation for Technical and VocationalEducation to Enhance Co-operation with the Worldof WorkBy M. Hijazi, O. Sharafi and N. Hizam

Cf. page 56�

National Profiles in Technical and VocationalEducation in Asia and the PacificEnglish, 750 pages, ACEID, UNESCO/PROAP Bangkok, 1995.This series of national profiles in technical and vocationaleducation has been developed for 21 countries in the Asia-Pacific region in co-operation with the Colombo Plan StaffCollege for Technicians Education, Manila, Republic of thePhilippines. Currently the profiles of the following countriesare available: Australia, Bangladesh, Bhutan, Fiji, India,Indonesia, Iran, Japan, Malaysia, Nepal, Pakistan, PapuaNew Guinea, the Philippines, the Republic of Korea, andThailand. The series also includes a regional synthesis ofissues and problems in the development of technical andvocational education in the region. The national profilesprovide a handy reference information on technical andvocational education systems, staff development, technicalco-operation and information networking.


Case Studies on Technical and VocationalEducation in Asia and the PacificEnglish, 371 pages, Royal Melbourne Institute of Technology (Australia) andUNESCO/PROAP Bangkok, 1995.UNESCO under the UNEVOC Project commissioned casestudies in technical and vocational education in Asia and thePacific. Researchers from Australia, Bangladesh, China, Fiji,India, Indonesia, Iran, Japan, Malaysia, Pakistan, theRepublic of Korea, Thailand and Viet Nam produced indi-vidual case studies with particular reference to the problems,issues and trends in technical and vocational education in therespective countries. A regional meeting in September 1994synthesized the outcomes of the researchers and formulated aseries of recommendations pertaining to possible directionsthat might be pursued by governments in the region toimprove the status of technical and vocational education.The case studies are accompanied by a conference report andan overview which provides a regional synthesis and recom-mendations.


Proceeding of the International Symposium onTechnical and Vocational Education(Beijing, China, 13-18 September 1993)English and Chinese, 360 pages, UNESCO Paris, the Chinese State EducationCommission and the Chinese National Commission for UNESCO, 1993.This proceeding collects the Final Report and 28 paperspresented during the symposium by participants from 20countries and international organizations. These papersextensively review the national policies and innovativemeasures to promote further development and reform in theparticipating countries. The Final Report of the symposiumattempts to summarize the current trends and major issuesconcerning this sector of education and recommends futureorientations to the policy-makers.


The Role of Technical and Vocational Education inthe Swedish Education System:A Country Case StudyEnglish, 31 pages, UNESCO/UNEVOC Berlin, 1995. Document No.ED/IUG/002This is one of a series of case studies commissioned byUNEVOC to inform interested parties on various aspects oftechnical and vocational education in different countries.This document describes in detail the Swedish system inwhich a school-based technical and vocational educationsystem is closely linked to general education.


The Role of Technical and Vocational Education inthe Education System of the Russian Federation:A Country Case StudyEnglish, 20 pages, UNESCO/UNEVOC Berlin, 1995. Document No.ED/IUG/003This document describes in detail the situation in the RussianFederation and illustrates the considerable difficultiesencountered by a technical and vocational education systemin a country undergoing radical economic change.


UNEVOC Publications

Co-operation with the World of Work in Technicaland Vocational EducationEnglish, UNESCO/UNEVOC Berlin, 1996. Document No. ED/IUG/007This document records and synthesizes a series of casestudies of four different countries (Hungary, Romania, theRussian Federation and Sweden) on the strategies andmodalities that have been developed and applied to promoteco-operation between technical and vocational education andthe world of work within these countries.

Request for copies: � (in press)

5 Co-operation with the Private Sector

Establishing Partnership in Technical andVocational Education. Co-operation betweenEducational Institutions and Enterprises in Techni-cal and Vocational EducationEnglish, 170 pages, UNESCO/UNEVOC Berlin, 1996. Document No.ED/IUG/005This document is the final report of a Seminar for KeyPersonnel from Africa and Asia held in Berlin, Germany, 12May 1995. It presents a wide range of perspectives on andexperience of co-operation between technical and vocationaleducation and the world of work. It is valuable as a resourceto guide people who are responsible for the promotion ofsuch co-operation.


Co-operation with the World of Work in Technicaland Vocational Education

Cf. page 58�

Coordination between Educational Institutions andEnterprise for Training in Bahrain, Jordan andLebanonBy A. Abu-Kabeer, A. Atwan, E. Al-Safadi and M. Hodib

Cf. page 55�

Policy and Legislation for Technical and VocationalEducation to Enhance Co-operation with the Worldof WorkBy M. Hijazi, O. Sharafi and N. Hizam

Cf. page 56

6 Girls and Women

Vocational Guidance for Equal Access andOpportunity for Girls and Women in Technicaland Vocational Education

Cf. page 55

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Promotion of the Equal Access of Girls and Womento Technical and Vocational Education

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7 Curriculum

Final Report of the International Workshop onCurriculum Development in Technical andVocational Education (Turin, Italy, 30 August-3September 1993)English and French, 24 pages, UNESCO Paris, 1993.The report reviews and analyzes the existing practices in thedesign, implementation and evaluation of technical andvocational curriculum, particularly in the development ofcompetency-based curriculum. Some common trends andsuccessful practices, based on the experience revealed in theparticipants' discussion papers and their deliberations areidentified. Major issues such as consideration of nationalsocio-economic development and technological advances,relevance of curricula and competency-based vocationaleducation, quality of teachers/instructors, attitude of studentsto technical and vocational education, financial support andinstitutional capacity in curriculum development etc. arediscussed in detail.


Adaptation of Vocational Curricula for IndustrialBusiness Clerks from Germany to the RussianFederationEnglish, 18 pages, UNESCO/UNEVOC Berlin, 1995. Document No.ED/IUG/004This document seeks to assist persons whose responsibility isto adapt various aspects of technical and vocationaleducation from one country, or system, to another. It uses asa model a curriculum of the German system as it has beenadapted to the Russian Federation.


Exemplar Curriculum Document for Entre-preneurial Skills for Small BusinessEnglish, 53 pages, Adelaide Institute of TAFE (Australia) andUNESCO/PROAP Bangkok, 1994.This document provides exemplar curricula for small busi-ness management, in six modules which were jointly devel-oped by a selected group of experts from seven UNEVOCCentres in Asia and the Pacific. The modules relate to:Entrepreneurial skills; Planning to start a small business;Establishing a small business; Managing and operating asmall business; Evaluating a small business; and entre-preneurial small business project. The document also pro-vides information to a range of flexible options related todelivery.



Guidebook for Curriculum Development andAdaptation (with Case Studies from Australia,Bangladesh, China, India, Malaysia, New Zealandand Pakistan)English, 40 pages (Guidebook) and 100 pages (Case studies), AdelaideInstitute of TAFE (Australia) and UNESCO/PROAP Bangkok, 1995.This guidebook on curriculum development and adaptationwas developed by a Technical Working Group of selectedexperts from 9 countries in the region at its meeting held atPandit Sunderlal Sharma Central Institute for VocationalEducation, Bhopal, India from 29 November to 6 December1994. The information in the guidebook is supplemented byan additional publication of documents which include twotemplates for curriculum formats and a series of case studiesoutlining aspects of curriculum development from someparticipating countries.


Atelier régional sur la méthodologie d'élaborationdes programmes d'informatique pour l'enseigne-ment technique et professionnel. Rapport final.(Abidjan, Côte d'Ivoire, 19-23 September 1994)French, 102 pages. Institut pédagogique national de l'enseignement techniqueet professionnel (IPNETP), Abidjan, and UNESCO/BREDA Dakar, 1994.This report includes a guide for curricula of computerscience and technology. It emphasizes on the competency-based pedagogical practice and presents examples of teach-ing modules of computer course at secondary level.


Guides/Modules for Prototype Curriculum Devel-opment in Technical and Vocational EducationPart one: Linkage of TVE Curricula to the World of WorkBy A. Nassrallah and S. Sulieman, Arabic, 83 pages,UNESCO/UNEDBAS Amman, 1994.

Part two: Integration of TVE Subjects and Other Subjects inthe Curricula.By A. Hiasat and A. Faris, Arabic, 93 pages,UNESCO/UNEDBAS Amman, 1994.

Part three: Promotion of Girls and Women in TVEProgrammesBy E Al-Mutlaq, Arabic, 88 pages, UNESCO/UNEDBASAmman, 1994.

The modules were produced as a result of the RegionalTraining Seminar on TVE Curriculum Development in theArab States (Amman, Jordan, 23-27 October 1994). Theywere presented as working documents in the seminar andlater were developed into guides/modules to be used in theregion. The country reports were also used in preparing themodules.


Final Report of the Regional Training Seminar onTVE Curriculum Development in the Arab States(Amman, Jordan, 23-27 October 1994)The seminar aimed to promote the use of modern techniquesand methodologies for curriculum development in technicaland vocational education through: linking TVE curricula tothe world of work; integrating TVE subjects and other gen-

eral subjects in the curricula and promoting the equal accessof girls and women to TVE programmes. The report includesthe topics discussed and general recommendations for devel-opment and up-grading of TVE programmes in the region.


Final Report of the Regional Workshop onMethodologies of Curriculum Development inTechnical and Vocational Education (Abijan, Côted'Ivoire, 19-25 September 1994)French, 65 pages, National Pedagogical Institute on Technical and VocationalEducation (Abijan, Côte d'Ivoire) and UNESCO/BREDA Dakar, 1994.This report summarizes the conclusions of the workshopdebate on the methodology of curriculum development intechnical and vocational education recommended by aprevious expert meeting. The methodology has been appliedin the hosting country and produced teaching modules intechnical education in general, and modules of computercourses in several fields of technical and vocational educa-tion such as industrial techniques, commercial techniques,management, office automation, etc.


A Guide for Evaluation of Technical andVocational Education CurriculaBy L. Kenneke

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8 Training Technologies

Final Report of the International Expert Meetingon New Training Technologies in Technical andVocational Education (Turin, Italy, 6-10 December1993)English and French, 100 pages, UNESCO Paris and the ILO InternationalTraining Centre (Turin, Italy), 1994.This report collects six technical papers presented during themeeting by experts in training technologies. They addresstopics such as selection and use of new training technologies(NTT) for technical and vocational education in developingcountries, comparative advantages of NTT in terms of cost-effective training, telecommunication supporting distancelearning, etc. A set of recommendations and follow-upactions are summarized at the end of this report.


New Training TechnologiesBy A. Herremans

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New Technologies of Training for Technical andVocational Education. Final Report of the SecondInternational Expert Meeting (Manila, Philippines,3-7 July 1995)English, 300 pages, UNESCO Paris, ILO International Training Centre (Turin,Italy) and Colombo Plan Staff College for Technician Education (Manila,Philippines), 1995.The meeting is a follow-up activity of the previous one heldin Turin in December 1993. The report includes countrypapers, countries. It also carries two project proposals

UNEVOC Publications

formulated during the meeting for using new training tech-nology at both national and regional levels.


9 Financing

Financing Technical and Vocational Education:Modalities and ExperiencesEnglish. 51 pages, UNESCO/UNEVOC Berlin, 1996. Document No.ED/IUG/006With contributions from P. Bolina and D. Atchoarena.The document includes two major contributions. The firstcontribution, by Ms Pradeep BOLINA, provides a systematicoverview of various modalities of public and private financeof technical and vocational education. The secondcontribution, by Mr David ATCHOARENA, draws conclusionsfrom experience with various existing concepts of financing.The document has been prepared by UNEVOC Berlin in co-operation with the German Foundation for InternationalDevelopment (DSE) and UNESCO's International Institutefor Educational Planning (IIEP). It is intended to stimulatedebate in Member States, and contribute to new and creativesolutions to the pressing need for the effective financing oftechnical and vocational education.


10 Vocational Guidance

Policies and Guidelines for Educational and Voca-tional GuidanceBy D. Stuart Conger

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Vocational Guidance for Equal Access andOpportunity for Girls and Women in Technicaland Vocational Education

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11 Information, Communication andNetworking

Feasibility Study for Facilitating Access to Data-bases and Documentation in TVE in UNEVOCCentres and Associate CentresArabic and English, 100 pages, UNESCO/UNEDBAS Amman and NationalCentre for HRD-Jordan, 1995.The study was prepared jointly by UNESCO/UNEDBAS andthe National Centre for Human Resources Development,Jordan (a UNEVOC Associate Centre) in cooperation withthe Computer Technology, Training and Industrial StudiesCentre (CTTISC) at the Royal Scientific Society (RSS),Jordan. It covers information on UNEVOC international,regional and national networks and the proposed structure ofUNEVOC network in the Arab States region. Informationwere also provided on technology available to facilitatelinkages between UNEVOC Centres/Associate Centres in theArab States region.


UNEVOC Directory/Répertoire UNEVOC.A world-wide Directory of UNEVOC Centres andUNEVOC Associate Centres

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12 Miscellaneous

Changing Vocational World: A Challenge toEducationEnglish, 52 pages, NCERT (New Delhi, India) and UNESCO/PROAPBangkok, 1992.This report of a UNESCO Seminar held in 1992 focuses onidentification of various challenges posed by the changingvocational world to the world of education, redefining therole of education in facing these challenges and recom-mending appropriate changes at various levels of the educa-tional continuum to link technical and vocational educationmore closely with the world of work. The report underscoresthat vocational education should have strong policy supportand should be fully backed by administrative and politicalwill. The report also makes recommendations about possibleshifts in funding technical and vocational education fromexclusive state financing to increasing contributions fromindustry and beneficiaries.


Final Report of the Regional Meeting for UNEVOCNetwork Members in Asia and the Pacific(Adelaide, Australia, 12-17 December, 1993)English, 36 pages, Adelaide Institute of TAFE (Australia) andUNESCO/PROAP Bangkok, 1993.This report of the first regional meeting of UNEVOC Net-work members from Asia and Pacific provides an identifica-tion of policy issues and curriculum issues in technical andvocational education in the region, expectations from theUNEVOC Network, and proposed functions of UNEVOCCentres and Associate Centres. The conference papers (82pages) and country briefing papers (98 pages) attached to theReport provide information on problems and issues in tech-nical and vocational education in respective Member Statesand general briefing about the countries.


Philosophies of Policy Development and Implemen-tation in Technical and Vocational EducationEnglish, 16 pages, Auckland Institute of Technology (New Zealand) andUNESCO/PROAP Bangkok, 1995.This report of a regional expert group meeting highlights keyissues in technical and vocational education policy develop-ment and implementation with particular reference to pur-pose of technical and vocational education, contextual fac-tors, values and some principles guiding implementation.The report also provides an outline of a framework forregional co-operation in the philosophies of policy develop-ment and implementation for technical and vocationaleducation and training.



Proceeding of the UNEVOC African RegionalConsultation Meeting(Nairobi, Kenya, 18-23 October 1993)English, 300 pages, Centre for Curriculum Studies in Africa, KenyattaUniversity (Nairobi, Kenya) and UNESCO/BREDA Dakar, 1993.This document contains the final report of this firstUNEVOC meeting in the African region and discussionpapers submitted by the participants describing technical andvocational education system in their countries. Case studieson curricula of computer technology conducted in Kenya arealso included. Strategies for launching the UNEVOCProject in sub-Saharan Africa and measures to ensure asubstantial contribution to the UNEVOC Project through thedevelopment of UNEVOC network are also discussed andreported.


Proceeding of Regional UNEVOC Expert Meetingin the Arab States (Bahrain, 20-24 March 1994)Arabic, 200 pages, UNESCO/UNEDBAS Amman and Bahrain NationalCommission for UNESCO, 1994.The proceeding includes the working documents and countryreports presented during the meeting. A list of UNEVOC

Centres/Associated Centres in the Arab States, addresses,and contact persons was also included in the document.


Final Report of the Regional UNEVOC ExpertMeeting in the Arab States(Bahrain, 20-24 March 1994)Arabic and English, 40 pages, UNESCO/UNEDBAS Amman and BahrainNational Commission for UNESCO, 1994This was the first Regional Meeting within the framework ofUNEVOC Project held in the region of Arab States. It wasattended by 38 participants representing 14 Member Statesand several regional and international organizations. Theissues discussed during the meeting includes implementationof the UNEVOC Project in the region; curriculum develop-ment in technical and vocational education; networking ofactivities in the Arab States and some general recommen-dations to the Member States.


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