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Back to School: How parents are faring amid inflation

Back to School: How parents are faring amid inflation

With students returning to school, Arab Finance asks parents how are they coping with inflation. For fiscal year 2022/2023, Egypt allocated around 66% of the budget in the education sector for salaries, reaching EGP 127,776 out of EGP 192,677. Could this budget have been allocated somewhere else?

A 10% increase in tuition fees for the new school year was only implemented in recent years. Before then, the annual increases were much higher, Bassem, who is a parent of two students in national division, says.

In the period from 2020 to 2022, inflation began to hit hard. Egypt's annual headline inflation recorded 15.3% in August 2022, compared to 6.4% in the same month of 2021, the Central Agency for Public Mobilization and Statistics (CAPMAS) announced in a press release on September 8th.

Despite this 10%, rumors have been circulating of higher-than-usual increases in school fees. Parents from private schools, private-public and international tell Arab Finance their take on the matter.

According to Mina, another parent, the Ministry of Education implemented an extra tax, but things started to heat up on the mommies’ groups and the parents protested, but it only fell on deaf ears.

Ahmed, one parent whose children are in the national division of a private-public school, says that he pays 15% higher for his elementary kids’ education. However, he explains that what schools do is raise the fees by 10%, then require another 5% under the name of “other fees.” So, at the end of the day, instead of paying x, you pay x + 15%, he explains.

These other fees are not obligatory, but they include fun activities like art classes and sports. “For me as a parent, I would not like my child to be excluded from these social activities, hence, I do feel obliged to pay them,” Ahmed admits.

Because the increase in school fees has a cap of 10%, schools compensate for this by increasing other expenses. Parents from private schools, private-public, and international told Arab Finance that buses’ fees increased by a range of 15%-30%.

From first grade to second grade, it is a 10% increase in school fees. “But if you think about it, from first grade to fifth grade, that is a whopping 50%,” Bassem says.

“I used to pay for my daughter around EGP 5,000 for her school tuition fees, fast forward 12 years and I pay for my son that goes to the same school EGP 25,000,” another parent of a public-private student who requested anonymity says.

Supplies were another element that have jumbled parents’ budgets. The prices more than doubled, they indicated. “I used to pay around EGP 1,000, now it is almost EGP 2,500,” Bassem said. However, Sally, whose children are in American division, says that the supplies also doubled in price, but instead of paying EGP 5,000 per child, she now pays an astounding EGP 10,000 per child.

The uniform has also been a point of complaint. Because of the ever-growing prices of uniforms, different outlets not associated with schools began to make exact copies with the schools’ logos, but that are much cheaper.

On 7 September, the ministry warned schools against selling school uniforms to students or forcing them to buy it from certain places, explaining that selling school uniforms is a violation.

Students are also required to buy some books like the A Level textbook that are not included in the school fees, in addition to study guides that help children with their basic skills. The prices of these books increased by 25-35% as there is a shortage and a waiting list to order them. “This goes to the hiking prices of paper,” Mina who works in the printing industry says.

“As Egyptian parents, we tend to spend a large portion of our income towards education and healthcare, even more than food supplies,” another father of three children in private-public schools says.

At the end of the day, the quality of education in all schools, whether national, American, private, or private-public is all the same. The only thing that is maybe different is international schools, he says.

“We were thinking of transferring our daughter to a governmental school instead of a language school and saving up to EGP 25,000 a year. But she refused, as she will no longer be with her friends and within her community,” he adds.

According to a statement by the Egyptian Exchange, the number of pre-university students exceeds 25 million students. Those who are in private or private-public schools are not more than 15%, the rest are in governmental schools.

A CEO of a private company, who is also a parent to two kids in international schools, tells Arab Finance, “the dynamics of investing in Education have changed dramatically in the past 20 years. Back then, it was compensated by the business environment. But unfortunately, the prices of schools have gone up drastically, but it was not compensated in the other side of the story with revenue coming from business, and thus students growing to be compensated with proper salaries.”

Thus, the return on investment (ROI) for students is almost non-existent. “We spend thousands of EGP on education only for our children to land their first jobs with a maximum of EGP 5,000 a month.” 

Yes, the cost of education has increased as everything else, but salaries have not, the CEO concluded.

So why would you opt for international education if they are all the same? “It depends on your social status; it is where your children mingle with others, so the geographical and social factors come into play.”

On the flip side, international schools are more exposed to the international community, so it preps the students to study abroad easier. But that presents a huge problem right now, where students of the private schools with the best education, 90% of them study abroad and then decide not to come back. “So now we are killing the elite.”

The House of Representatives approved by mid-August a ministerial reshuffle, where Reda Hegazy, who had long held the position of deputy minister of education for teachers’ affairs at the Ministry of Education, was appointed the new Minister of Education. Hegazy's appointment came a few weeks ahead of the new school year in Egypt.

Soon after, Hegazy announced a new decision in an attempt to overhaul the education system, one of which is that legal measures will be taken against those found to be violating the school fees.

 

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