Does public expenditure management matter for education outcomes?

Abstract

This paper examines the significance of public expenditure management for primary education outcomes in public schools in two South African provinces (Gauteng and North West). Using cross-sectional data from 175 public primary schools and 13 local education offices, the analysis finds that while misappropriation of education funds (leakages) is not strongly associated with poor education outcomes, delays on the part of the government in disbursing funds to schools are correlated with Grade 5 dropout rates. The paper finds no evidence that public expenditure and total resource wealth (including public and private contributions) are significantly associated with education outcomes. Increased spending on learning and teaching support materials is associated strongly with lower Grade 1 and Grade 7 repetition rates. The paper also finds that repetition rates are driven strongly by poverty indicators at the district level, while dropout rates are driven strongly by district and school inefficiency.