MASTER OF ARTS IN INDUSTRIAL EDUCATION

Major in Home Economics

H.E 216
ADMINISTRATION AND SUPERVISION OF INDUSTRIAL EDUCATION INSTITUTIONS

GROUP 3 : Speaker 2
Chapter XIX
Financing Education As An Administrative Function
Objectives
1. To develop an understanding of the provision in the Constitution regarding the responsibility of the
government in the support of education.
2. To develop among the students of the manner in which the public educational institutions are
presently financed.

The Constitutional Provision About the Support of Education

The Filipino people have always recognized the importance of education in the promotion of
national welfare and have procured the enactment of laws providing for the establishment of public
schools.
The Constitution of the Republic of the Philippines of Article XIV Section 5 provides for the
establishment and maintenance of a complete and adequate system of education and to provide at least
free primary education for all children of school age. This provision expresses the educational ideal
of the early Filipino leaders. It also expresses a recognized policy of our government since the inception
of the present educational system in 1901. The Filipinos are proud of the fact that free primary schools
is maintained to meet the needs of our young citizens. It is true that pupils who attend public primary
schools pay little or nothing for their education. This is made possible by the fact that the financing of
primary education is accepted as the democratic responsibility of all our people, whether or not they
avail themselves individually to such education.
Commonwealth Act No. 586 Section 5, otherwise known as Educational Act of 1940, places
the support of elementary schools, both primary and intermediate, upon the National government.
Under this law, primary education in chartered cities is financed by the National government, while
intermediate school education is financed by the city government.
Republic Act No. 896 Section 5, known as the Elementary Education Act of 1953, makes
elementary education not free, but also compulsory. This law was passed as a means to prevent the
excessive withdrawal of pupils from elementary schools and to enable every child who enters school to
make his education worthwhile by completing the elementary grades. Since the operation of
elementary school is not only the concern of the National government but of the local government as
well, Republic Act No. 5447 was passed to provide increasing participation of local government in
contributing to the financial support of the public schools in their respective jurisdiction.

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 Because of a consistently inadequate program of financing current public schools and colleges
not only have steadily declined in standards but have been increasingly incapable of fulfilling the
Constitutional mandate of free and compulsory elementary education. In order to minimize the
recurrent difficulties arising from meager school appropriation, a comprehensive financing scheme was
made possible through the passage of Republic Act No. 5447 which provides for a special source of
funds for public education from specific taxes. It is expected that the financial situation for education
henceforth will be increasingly improved. Our educational leaders believe that the implementation of
this new Educational Act would not only avert the annual standards to desired levels or goals.

The new Civil Code of the Philippines likewise recognizes the duty of the government to
promote the welfare of the child. Article 359 of the Code states that the government promotes the full

growth of the faculties of every child. For this purpose, the government will establish, whenever
possible, a school in every barrio and municipality and city where optional religious instruction shall be
taught as the curriculum of the option of the parents or guardian. This reveals the earnest desire of the
government to put into execution the educational provision of the Constitution.
The Filipino people derserve commendation for the financial support given to education.
However, what they have done is small compared to what they should be asked to do if adequate
education is to be provided for all the youth of the land. What the future holds for the Philippines
depends largely upon what the Filipinos spend for education.
Sources of the School Revenue
The local and national governments have no revenue ear-marked for education. The general
sources of revenue spent for school support and educational purposes may be classified into taxes,
tuition fees, other fees, volountary contributions, income from land grants and donations, and income
from leased school sites and from school products.
1. Taxes – Charged by the authority of the State by virtue of its sovereignty for the support of the
government. Most of the money from this source come as shares from general taxes. In addition,
Special Education Fund has been created from funds derived from an annual additional tax of one
percent of the assessed value of real property in addition to the real property tax levied thereon under
existing law and a portion of taxes on Virginia type cigarettes and duties on imported leaf tobacco.
Much of what is spent for public education comes from general taxes, such as property tax, specific tax,
ad-valorem tax and excise tax.

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2. Tuition fees – Charged from secondary school students in public high schools, vocational schools
and other schools of collegiate level including the University of the Philippines.
3. Matricultion fees – Charged from secondary students in public high schools, vocational schools and
other schools of collegiate level including the University of the Philippines.
4. other fees – Charged from collegiate students such as registration, entrance, library, athletic,
laboratory, medical, school organ , R.O.T.C., graduation, and diploma fees.
5. Volountary Contribution – may come from pupiks and students or from parents. Parents may
contribute money, materials, and labor in the building and repair of schoolhouses and for the
improvement of scxhool sites. Private individuals may also give contribution for school support.
6. Income from land grants and donations – The University of the Philippines gets some income from
the parcel of the land granted by the national government. The Bureau of Public Schools, now the
Bureau of Elementary Education gets some income from the Jalondoni Estate. The Roxas Memorial
Agricultural School in Albay gets some income from the farmer Japanese property at Mauraro, Albay.
7. Income from leased school sites and from school products – Some school lease part of their unused
school sites for agricultural purposes and derive some income therefrom. A small income is also derive
frm the sale of the products of the students’ labor from the school farms, gardens, nurseries, and shops.
The bureau of Public School, now the Bureau of Elementary Education also receives financial
assisstance from the Philippine Charity Sweepstakes funds. The School for the Deaf and Blind is also a
recipient of such aid.
Sources of Income for Elementary Education
The sources of municipal school funds included the real property tax, internal revenue
allotment, marriage license fees, building permit fees, and residence tax, together with the fine and
penalties. On account of the added responsibilities on the part of the national government in financing
elementary education in accordance with the Educational Act of 1940, the law has withdrawn at the
same time the share of the municpalities and municipal districts in the internal revenues, percentage,
taxes, an agricultural products, income tax, which allotments use to accrue to their general fund and
school fund. The National government has also withdrawn the portion of the residence tax accuring to
school funds of the municipal districts and the chartered cities, to which the latter was entitled prior to
July 1, 1940. Since then, the municipal school fund has been abolished and any amount of it existing at
the time was turned over to the municipal general fund. All other revenues which hitherto accrued to
the municipal school fund were diverted to the municipal general fund.
Although all elementary classes in the municipalities and in chartered cities are supported by
the National government, the local officials are allowed to set aside local funds for the support existing
or new elementary classes. Contributions from private individuals and parent-teacher associations for
the support of elementary classes are also accepted.
Revenues of the National government now provide most of the public school funds for the
support of elementary schools, except for the acquisition of school sites and the construction of
temporary school buildings, thus depriving provinces and cities of the responsibility of financing their
own public schools. To enable the National government to finance properly the public elementary
schools and meeting the burden of their operation, Section 8 of Commonwealth Act No. 586 provides
for the disposition of the proceeds of the taxes under Commonwealth Act No. 465, known as Residence
Tax Law.

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 Commonwealth Act No. 586 Section 9 also prohibits the collection of tuition fees in the
intermediate schools but allows matriculation fees in an amount to be determined by the President and
not to exceed two pesos for each enrolled in the intermediate grades in municipalities and municipal

districts, the proceeds thereof to accrue to the funds of the National government to be expended
primarily for the purchase of library books and equipment, and for financing athletic activities in
intermediate classes.
Sources of Income for Public Secondary Schools
In the Philippines, the maintenance and operation of public secondary schools is a function of
the provincial and city governments. It can be said that, with a few exceptions, the public secondary
schools do not have adequate financial resources.
It is because of this meager and unstable finacial resouces of the local goverments that our
public secondary schools are in the present predicament of financial insufficiency.
Broadly speaking, the provinces derive their income from the following sources;
1. Internal revenue allotment from the national government;
2. Collections from local taxes;
3. Fees from service rendered; and
4. Miscellaneous income from receipts
For the public secondary schools, tuition fees and matriculation fees at present constitute the
principal sources of income. Where income from these sources is fund inadequate to meet the various
expences, the provincial board may transfer the needed amounts from the provincial general fund to the
school fund and/or increase the rate of tuition fees. It cannot be denied that some such schools do not
have any other income except from tuition fees. The rate vary from P60 to P120 a year per student, the
average being P80 a year.
Contribution from PTA’s donations by private individuals and civic organizations are other
sources of income for public secondary schools. However, we could not count much on these sorces of
income for substancial increase of revenue to help strenghten the financial support of our public
secondary schools. Only a generous financing of secondary schoola can improve the quality f our
secondary education. To provide an adequate source of support, the secondary schools must be financed
jointly by tuition fees and from provincial school fund revenues.
Some municipalities help the province in supporting the provincial high schools which are
located in their territory. This aid is made possible in the form of transfer from the municipal general
fund to the provincial school funds. Some municipalities maintain their own high schools which are
generally known as municipal high school.
Sources of Income of the City Government
Chartered cities support their secondary schools and intermediate classes. All cities in the
Philippines have definite school funds which are derived from special taxes from their share of the
internal revenue taxes and from tuition fees. Chartered cities also received aid from the National
government as a lump sum which becomes a part of the city school funds. Chartered cities are the nly
political entities which have retained the school revenue originally created by Residence Tax Law
because of their responsibility to support their intermediate classes.
City public high schools are supported by the city from its school funds. It cannot be denied
that both the city and provincial governments spend very little public money for their high schools
because of the school funds which are derived from the annual tuition fees of the students.
Sources of Income of the National Government

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 The National Government has no revenue earmarked for education. The funds for the operation
of the National government and the performance of its functions are derived from the different general
sources of income. Revenues from taxation includes import duties and taxes; income taxes; excise taxes

on domestic products; foreign exchange tax; license, business and miscellaneous taxes. Incidental
revenues include fines and forfeiture, sales of national domain and related assests, and miscellaneous
incidental revenue. The items under earnings and other credits and income from services rendered,
operating income, rentals, and profit from sales and other items.
Support of Education in the Philippines
The funds necessary to operate the public schools come from municipal, provincial, city and
national governments. Public education in the Philippines is supported in the following manner.
1. Support of Elementary Schools
The support of elementary education by the national government commenced with the
enactment of Act No. 74 of the Philippine Commission in 1901. This Act laid the foundation of the
public schools system which provided that “all primary instruction in the schools established and
maintained under this shall be free.”
Public elementary education before the Educational Act of 1940 was maintained and
supported jointly by the local and national government. The dual responsibility for the support of
elementary education was found unsatisfactory as confusion rresulted because local governments were
unable to organize intermediate classes to accommodate the pupils. Commonwealth Act No. 586 was
passed to remedy the situation. Since the enforcement of this Act, the National Government has
assumed the responsibility and maintenance of elemetary schools, except that the chartered cities are
required to provide for the support of their intermediate classes.
The system of supporting elementary education as outlined in Commonwealth Act No.
586 is amended by Republic Act No. 4092. According to this Act, all the public elementary schools
comprising the primary and intermediate classes through-out the country are supported by the national
government. Schools sites for the public elemetary schools are, however, acquired by the
municipalities, municipal districts, and chartered cities as the case may be, either through purchase,
conditional, or absolute donation.
Altough all public elementary schools are fully supported by the nayional government,
the local officials are allowed to appropriate local funds for the support of the public schools in their
jurisdictions. Contributions of parent-teacher association and private individuals are also welcomed for
this purpose.
The nationalization of school support for elementary education makes the
administration of school finances much easier and results in the quality of the public elementary
schools throughout the islands. On the other hand, it generally reduces the responsibility of the
government and the people of the local units for their schools and tends to accelerate the decrease in the
democratic local self-government. New sources of income for support of an expanded elementary
education are not provided for by Republic Act No. 4092. This Act simply changes the support of
intermediate classes in chartered cities.
2. Support of Public High Schools
The Commonwealth Act No. 586 has no provision for the support of public high
schools. The general secondary schools are supported by the province, city, or municipality. The
province supports the provincial high school which is usually located in the provincial capital. The
money for the suport of these schools is take from the provincial school fund provided for by Section
211 ½ of the Revised Administrative Code. Much of this school fund comes from tuition fees collected

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from students. At times they also receive aid from the municipal funds and from Parent-Teacher
Association.

The public high schools established in towns are financed by the municipality with the
aid of provincial government. The minicipal high schools are supported totally by the municipalities
where they are established. All city public general secondary schools are financed by the chartered
cities. They also regularly receive aid from the National government. The National aid becomes a part
of the city school funds.
Although each provincial government has a so-called provincial school fund, the law
makes no specific provisions for the support of public secondary schools. Because of this, public high
schools have no stable means of support. One additional burden was placed upon the general secondary
schools with the abolition, by virtue of Republic Act No. 673, of the positions of national (Insular) high
school principals. Starting with the school year 1951, it therefore become necessary to provide the
salaries of the principlas of these schools from purely local funds. Another expense item that has to be
shouldered by all share of the retirement insurance premiums of their teaching personnel. Such
provision is in accordance with Republic Act No. 660.
The support of public secondary schools depends upon the goodwill of the provincial
board resulting too often in the school funds not being sufficient for the maintenance of the school.
Provinces with deficits in their budgets charge a tuition fee ranging from sixty to one hundred twenty
ppesos per annum, necessary to cover the deficit. The proceeds from these fees constitute the main
support of public high shools as it is generally greater than the amount trabsferred from thw general
fund. A few provinces let their high schools depend for support entirely on the tuition fees collected
from students for they make no transfer at all. Because of this practice, provincial high schools are mre
or less self-supporting governmental institutions. It can be said that the support of public high schools is
contingent upon the initiative and leadership of the division superintendent and is dependent upon the
good grace of the Provincial Board.
3. Support of Trade Schools
Trade schools in the Philippines are of three types, namely: the provincial trade
school, vocational high school, and national school of arts and trades. The national school of arts and
trades is entirely supported from National funds; tuition fees are charged in some of the trade and
vocational high schools and in the national schools of arts and trades. Vocational schools have the
option to charge tuition fees as per provisions of Republic Act No. 364 which took effect on June 9,
1949. Presently provincial trade schools are supported jointly by the provincial and national
governments. At present, secondary trade schools are termed National Secondary Trade Schools.
4. Support of Agricultural Schools
On the basis of financial support, agricultural and rural high schools are classified into
three groups. They are the regional national agricultural, the special national agricultural and rural high
school. Each of the regional agricultural schools serves as a region or section of the country and is
entirely supported from the National funds; special national rural and agricultural high schools are
largely supported by the National government and to some extent by the various provinces or
municipalities where they are located; the rural high schools are supported by the respective provinces
and municipalities and also by the national government.
5. Support of National Schools
The National government has established seven normal schools located at strategic
places and serving a number of provinces. The province in which they are located partly supports these

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schools besides being maintained by funds from the National treasury. The salaries of the normal
school personnel as principals, deans, supervisors, instructors, and critic teachers are borne by the
National government. The city or municipality in which they are situated may also allot funds for the

normal training department. It can be said that normal schools are supported jointly by the provincial
government and the National government.
6. Support of the Philippine Nautical School
The Philippine Nautical School in Pasay City is the only nautical school offering a two-
year nautical training necessary for employment as deck officers of a merchant vessels. Being a nautical
school, its main source of support is from the National Treasury. In other words, this school is entirely
supported by the National government.
7. Support of the School for the Deaf and Blind
This school is the only institution of this kind conducted by the Bureau of Public
Schools, now the Bureau of Elementary Education. It is supported entirely by National funds and from
the contributions of the Philippine Charity Sweepstakes. Tuition, board, laundry, books and other
equipment are furnished the students.
8. Support of chartered government schools
The University of the Philippines, the Philippine Normal College, the Philippines
College of Commerce, Central Luzon University, the Mindanao Agricultural College, and Mindanao
Institute of Technology are mainly financed from a regular annual appropriation by Congress. Tuition
and other fees are charged to give additional income. Aside from the annual appropriation of National
government, the schools receive special aids for the construction, repair, and improvement of buildings.
Analyzing the above discussion, it can be said that there has been some changes in the
trend of the sources of support, tending toward somewhat smaller proportion of local support. It can
also be noted that the national government is assuring a very proportion of support or cost of education.

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Member: Philippine Association of State Universities and Colleges (PASUC)
Agricultural Colleges Association of the Philippines (ACAP)
Accredited: Accrediting Agency of Chartered Colleges and Universities of the Philippines (AACCUP)
Member: Philippine Association of State Universities and Colleges (PASUC)
Agricultural Colleges Association of the Philippines (ACAP)