A new report by ActionAid’s multi-country International Education Team builds on previous research and new in-depth country case studies from Malawi, Mozambique and Sierra Leone: “Confronting the Contradictions: The IMF, Wage Bill Caps and the Case for Teachers.”
ActionAid found that a major factor behind the chronic and severe shortage of teachers is that IMF policies have required many poor countries to freeze or curtail teacher recruitment. The IMF may have varying degrees of influence in directly setting the level of funds available for wages of public sector employees, or the “wage bill ceilings.” However, by insisting on overly-restrictive macroeconomic policies that unnecessarily constrain overall government spending in national budgets, and thus constrain sector budgets and public employees’ wages, the IMF is in part responsible for the persisting teacher shortage.
In all three countries examined, the wage bill ceiling is too low to allow the governments to hire the teachers they need to achieve the pupil-teacher ratio (PTR) of 40:1 recommended by the Education for All: Fast-Track Initiative (EFA-FTI). There is considerable evidence that the current ceilings compromise the quality of education in each of these countries. However, because the specific inflation-reduction and deficit reduction targets in the IMF loan programs are already constraining the size of the overall national budgets at unnecessarily low levels, even if the formal wage bill ceilings are removed, money available for the public sector wages is still effectively constrained. The wage bill ceiling is only a symptom of a deeper problem: it’s the inflation and deficit targets that must be changed.
Led by Akanksha A. Marphatia, the ActionAid International Education Team report highlighted that there is a growing policy contradiction at work in the foreign aid system and it is undermining education goals around the world: At the same time as the richest donor countries are trying to scale-up spending and foreign aid for education with one hand, they are also blocking the ability of many poor countries to spend that aid because of IMF loan programs they’re approving with the other hand. This presents a contradictory set of policies that are working at cross-purposes. The ActionAid report called on education advocates and donors to deal with resolving the contradiction. The IMF issued a public response to the report on its website, and ActionAid’s Education Team responded.
