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Financing Early Education

Financing Early Education. Preschool Policy Briefing June 22, 2004 W. Steven Barnett, Ph.D. National Institute for Early Education Research Copies and details available from: www.nieer.org (732) 932-4350, sbarnett@nieer.org. Presentation Overview.

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Financing Early Education

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  1. Financing Early Education Preschool Policy Briefing June 22, 2004 W. Steven Barnett, Ph.D. National Institute for Early Education Research Copies and details available from: www.nieer.org (732) 932-4350, sbarnett@nieer.org

  2. Presentation Overview Why does early education financing matter? • Access is incomplete and unequal • Quality is too low • Families struggle with the cost • Voters want government to step in America can afford a better policy • Total cost is low • Public and private sectors can share costs • The cost of missed opportunities is higher

  3. America Faces Serious Challenges • Sustaining economic growth • Increasing productivity and competitiveness • Increasing educational achievement • Meeting future public commitments --Social Sec., Medicare & Medicaid 75% of 2040 budget • Ensuring a better future for America’s children

  4. Early Education can be part of the Solution Increases Educational Success and Adult Productivity • Cognitive abilities, achievement, & school success • Social behavior • Employment, earnings, and tax revenue Decreases Costs of Government • Schooling (special ed. & grade retent.) • Social services • Crime • Health care

  5. Cognitive Readiness Gap

  6. Social Readiness Gap

  7. Costs of Early Education The Cost of Early Education Depends on the Design • Ages served • Hours of the program • Quality—teacher qualifications, class size, etc. • Targeted or universal • Systems costs--start up and infrastructure What are benchmarks for cost? • Per pupil costs of K-12 education: $8,733 • Per pupil costs of Head Start: $6,934 • Per pupil state expenditure on PreK: $3,455* * Does not include local share of costs.

  8. Early Education Finance in Perspective (FY 2005 Budgets) American economy, annual GDP = $12.0 trillion Federal annual spending = 2.4 trillion State and local annual spending = 1.2 trillion Social Security and Medicare = 800 billion Agri-business subsidies = 15-20 billion Head Start = 6.9 billion State Pre-K = 2.5 billion UPK = $10-30 billion

  9. Revenue Sources • New taxes and gaming revenue • Borrowing (deficits, bonds for tax cuts, facilities) • Obtain more existing education funds (Title I) • Displace other noneducation spending (economic devel.) • Tax breaks • Parent fees (sliding scale, core v. care)

  10. Conclusions • Access and quality problems require public finance • Quality pre-K for all is good national policy • We need a solution for everyone • The cost is modest • Options include tax increases, tax cuts, borrowing, spending shifts, and parent fees

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