The research objective of the thesis is to systematize the theoretical basis and propose practical and scientific solutions to improve the local budget expenditure management for public education in order to improve the efficiency of resource use. financial resources for education, contributing to the development of education in Thanh Hoa province.
1 PREFACE 1. Urgency of the thesis topic Local budget expenditure on public education received considerable attention in Thanh Hoa province during the 20112017 period, accounting for 20% of total balance of local budget expenditures. There are also changes in management of local budget expenditure on public education: the management decentralization is relatively transparent; the province issued guidelines documents and schedule for creating local budget estimate in a timely and fairy clear manner; norms of regular local budget expenditures display differences according to regions, thus ensuring fairness in education; the structure of local budget expenditure for grades show changes to match with the local development targets… However, there are shortcomings to be overcome in management of local budget expenditure on public education in Thanh Hoa: allocation of resources for development investment expenditures does not match with the decentralized spending tasks; estimates of annual local budget expenditure for public education are not associated with mediumterm and longterm development planning of the industry, causing difficulties for arranging priority order in implementing targets and tasks; allocation norms of local budget expenditure for public education is still based on input factors, resources of local budget for public education are still limited and do not satisfy the funding requirements for local education; in estimating local budget expenditure for public education, there is no link between funding allocation with output or results; final statements of local budget expenditure on public education are mainly final finanal statements to check adherance to mechanism, norms, targets and complience to estimates given at the beginning of the year … Studies about financial management for education and training so far have analyzed, evaluated, and proposed silutions to improve resource mobilization for education development, reform of budget allocation mechanism in education, financial management of the agency in charge (Department of Education and Training) for high schools However, there is no independent study about management of local budget expenditure on public education, especially in the conditions of implementing new regulations on management of state budget since the State budget Law 2015 came into effect Based on these issues, the study to find out solutions to improve management of local budget expenditure on public education in Thanh Hoa is necessary, both in terms of theory and practice 2. Research objects These objects are theoretical and practical issues about education and management of local budget expenditure on public education 3. Research objectives The thesis’s research objectives are to systemizing the theoretical basis and proposing solution of practical and scientific importance to improve management of local budget expenditure for public education so that the efficiency of using financial investment resources for education is enhanced, contributing to the development of education in Thanh Hoa, specifically: i) Systemizing and establishing the theoretical framework of management of local budget expenditure on public education; ii) Studying, analyzing, and evaluating the reality of management of local budget expenditure on public education in Thanh Hoa; iii) Proposing solutions to improve management of local budget expenditure on public education in Thanh Hoa until 2025 with vision to 2030 4. Research scope In term of content: the thesis focuses on studying contents of management of local budget expenditure on public education: management decentralization, estimate planning, estimate compliance, final statement of local budget expenditure for public education (development and regular local budget expenditure) from the perspective of financial management The term “education” in the thesis is understood in a narrow meaning, including general education and preschool education (not including higher and vocational education). In terms of space and time, the thesis studies the reality of education and management of local budget expenditure on public education during the 20112015 of budget stabilization, extending to 2016 and 2017 Solutions to improve management of local budget expenditure on public education in Thanh Hoa are proposed for implementation until 2025 with vision to 2030. 5. Study methodology The following methods are used to study contents of management of local budget expenditure on public education in Thanh Hoa: Methods of analyzing and synthesizing theory These are methods of collecting information based on studying existing documents about management of local budget expenditure on public education to establish the theoretical framework for the thesis and verify data about management of local budget expenditure on public education in Thanh Hoa Based on overview of previous studies about management of local budget expenditure on public education, the author analyzed and synthesizes theories to identify the theoretical framework related to management of local budget expenditure on public education and research gap. Data for analysis come from related local and international magazines, scientific reports, publications, and electronic Through this method, the author collects and processes the following information: + Theoretical basis related to management of local budget expenditure on public education; + Published results of studies about management of local budget expenditure on public education + Data about management of local budget expenditure on public education in Vietnam and in Thanh Hoa + Policies related to management of local budget expenditure on public education Specialist method This survey method gathers specialists’ evaluation on management of local budget expenditure on public education via indepth interview with financial management officers at levels and units using budget There are two groups of interview objects: (i)Financial educational management officers Indepth interviews with management officers at financial management office at different levels: the author interviewed with 10 officers at district level (out of 24 district, town, and cities). Indepth interview with financial management officers at educational and training officers at levels: the author interviewed with 10 officers at districts, towns, and cities (ii) Financial management officers at budgetusing units The author carried out indepth interviews with 22 budgetusing units in the education industry For units at provincial levels (high schools), the author interviewed financial management officers at 01 high school. For preschool, primary and secondary schools, the author interviewed management officers (headmasters) in Thanh Hoa city, Tho Xuan district, Cam Thuy district, and Muong Lat district which represent 04 regions according to the classification allocation norms of local budget expenditure on public education of the province. For each district region, the author interviewed 03 budgetusing units of the province (preschool, primary and secondary school) and 10 financial management officers at 10 high schools (planning units at provincial level). Interview duration: from Jul/2016 to Oct/2016 6. Overview of domestic, international studies related to thesis topic The thesis studies doctoral theses, local and international studies and articles related to the thesis topic, such as studies on state and local budget expenditure on public education, on local budget expenditure on public education (allocation mechanism, management decentralization) These researches provide relatively adequate studies on financial mechanism of education from the angles state budget expenditure on education, education management decentralization and finance However, there is no comprehensive report or study on management of local budget expenditure on public education from financial agency; no study looks at conditions to implement management of state budget expenditure on education cho education in association with local task results or establishes criteria to evaluate the efficiency of local budget expenditure on public education. Research direction: The thesis titled “management of local budget expenditure on public education in Thanh Hoa province” analyzes and clarifies theoretical basis on management of local budget expenditure on public education, evaluates the reality in Thanh Hoa and proposes solutions to improve management of local budget expenditure on public education in association with mediumterm development planning of the industry and with task results 7. Structure of the thesis In addition to the preface and conclusion, the thesis has 03 chapters: Chapter 1: General theory of education and management of local budget expenditure on public education Chapter 2: Reality of management of local budget expenditure on public education in Thanh Hoa Chapter 3: Solutions to improve management of local budget expenditure on public education in Thanh Hoa Chapter 1 GENERAL THEORY OF EDUCATION AND MANAGEMENT OF LOCAL BUDGET EXPENDITURE ON PUBLIC EDUCATION 1.1. GENERAL THEORY OF EDUCATION 1.1.1. Concept of education Education (in the broad sense) includes processes to develop characteristics, personality, ideal for learners through organizing activities and exchange (education process in the narrow sense) and processes to develop competency and knowledge for learners through interaction between teachers and learners (the teaching process) Or it is the interaction process between teachers and learners at education facilities to help learners acquire scientific knowledge, cognitive and practical operational skills and develop creative capacities, based on which the worldview and personality of learners can be formed according to education purposes 1.1.2. Characteristics of education From the perspective of economics, education displays the following characteristics: 1.1.2.1 From suppliers of education Firstly, suppliers of educations always have more information about the quality of education than users due to due to disproportionate information issues Secondly, competition in providing education service is more and more fierce Thirdly, the selection of public education service depends on the goals of government in maintaining social benefits in each specific period 1.1.2.2 From users of education Firstly, education is the basis condition to fairness development in social development Secondly, private benefit in education is always less than social benefit 1.1.3 National education system The national education system includes the system of schools, culturaleducation agencies outside schools, and the system of education management agencies and scientific research agency on education management and teaching. The system of schools takes the main role in education system as it is the one talked about the most In Vietnam, the national education system includes formal and continuing education with the following grades and educational levels: Preschool education: kindergartens and kindergartens; General education: primary, secondary, high school; Vocational education: elementary, intermediate and college education; Higher education: university, master and doctoral level 1.1.4. The role of education Firstly, education contributes to promoting economic development via increasing labor productivity. Secondly, education contributes to improving the quality of human resources, satisfying growing requirements of the labor market Thirdly, education contributes to solving social security issues and forming a spiritual culture of society 1.2 LOCAL BUDGET EXPENDITURE ON PUBLIC EDUCATION 1.2.1 The concept of local budget on public education Local budget expenditures on public education are expenditures to ensure activities of education, including: maintaining regular activities of the industry (for teaching and learning activities at public education facilities); ensuring material infrastructure for education; implementing education programs, projects and plans according to state management decentralization policy on education to carry out local target on education and human resource development 1.2.2 Characteristics of local budget on public education Firstly, it is stable Secondly, it aims for development purposes Thirdly, it requires high fairness Fourthly, its results are difficult to measure Fifthly, it depends on national policies 1.2.3 Content of local budget expenditure on public education It can be considered from many different angles, from budget level, grade or economic content. The last one is usually used; according to which local budget expenditure on public education includes: Expenditure on education development: to improve education infrastructure. Investment from local budget is made for public education facilities (high schools, continuing centers, preschools) according to decentralization mechanism to ensure material conditions to carry out development targets and tasks of local public education. Regular local budget expenditure on education: to maintain regular education activities These expenditures ensure teaching and learning activities in public education facilities, ensures local management activities, and to ensure carrying put general tasks of the industry 1.3 MANAGEMENT OF LOCAL BUDGET EXPENDITURE ON PUBLIC EDUCATION 13.1 Concept, goals, and methods of management of local budget expenditure on public education 1.3.1.1 Concept and goals of management of local budget expenditure on public education Management of local budget expenditure on public education is the organized, directed, oriented and planned impact of local authorities (levels of local authorities, financial and education agency) on the distribution and usage of financial resources from state budget for local public education to carry out local education development. Fiscal management at levels of local authorities in general and management of state budget expenditure on public education in particular aim at the following goals: Fiscal discipline: For the field of education, maintaining fiscal discipline is the arrangement in the education industry to implement local goals and tasks based on allocated resources (budget ceiling). The total amount of local budget expenditure on education (support from the government and local budget resource) does not exceed budget ceiling in the medium term (including investment and regular expenditure), except for special cases Allocation efficiency: In the context of limited resources for local budget and limited resource allocation for education, it is necessary to select the most important issues to be addressed in the industry from the process of socioeconomic development planning and industry’s development planning to prioritize resources Based on that, the allocation of resources in local budget for tasks’s of the education industry needs to pay attention to important tasks and goals right from the budget planning budget. Operational efficiency: When pursuing the goal of operational efficiency, there are 2 points to take note:(i) If management officers are not granted the rights to be proactive in making decisions, it is not right to hold them responsible for output product, and (ii) when they are not ready and not held responsible for task results, they are also should not be allowed to be independent in using budget resources, Therefore, accountability factor plays a remarkable role in increasing operational efficiency. 1.3.2.2 Methods of management of local budget expenditure on public education Firstly, management of local budget expenditure on public education according to output: the focus is on strict control of input expenditures in budget using units through the system of norms and criteria issued by an authorized state agency. Management mechanism, norms for expenditure and budget usage and even the viewpoint of building financial management mechanism is established according to the motto of the stricter the better Secondly, management of local budget expenditure on public education according to task results: this is the management method that associates allocated expenditure with results or services provided by budgetusing units in the education industry. 1.3.2 Content of management of local budget expenditure on public education 1.3.2.1 Management decentralization of local budget expenditure on public education Management decentralization of local budget expenditure on public education is the identification of scope, responsibility, and rights of local authorities, planning unit in implementing tasks of local budget expenditure on public education in line with the local’s management decentralization in education. To build an appropriate management decentralization mechanism of local budget expenditure on public education, it is necessary to based on: Firstly: the law system on management decentralization in economics, society and organization of local government Secondly, ability to provide education services of local authorities Thirdly, management competency of each level of local authorities 1.3.2.2 Planning of local budget expenditure on public education The planning process of local budget expenditure on public education follows the general process of local budget planning that includes: planning of programs, tasks, missions, development context of local education industry and resource ability of local budget; guiding planning; creating estimate; submitting and approving estimates of local budget expenditure on public education in the overall estimate of local budget expenditures. Specific phases are as follows: Planning from the highest level downwards In this phase, based on policies, programs and development plan of the education industry as well as resources of local budget, financial agencies identify expenditure ceiling and inform units in the educations and localities as the basis to create annual planning and mediumterm vision. Based on this expenditure ceiling, the education industry will choose expenditure program according to priority order and can be proactive in choosing expenditure structure and reduce intervention of financial agencies in defining internal structure of the industry Planning from the lowest level onward Budgetusing units and localities in lower levels base on the industry’s development plan and orientation, annual target, informed expenditure ceiling, guidelines on planning and current management method of state budget expenditure in each specific period to create estimates for local budget expenditure on public education according to different methods. In management of local budget expenditure on public education according to input factor, localities create estimate based on input (workforce teacher, expenditure to maintain operation of localities, unit material, teaching material….) and criteria, mechanism, norms of expenditure issued by authorized agencies. Allocation norms of local budget expenditure on public education in case of managing local budget expenditure according to input include the expenditure rate of local budget for a group of tasks (salaries, training….) In management of local budget expenditure on public education according to task result, it is necessary to quantify all the relation links among input (education expenditure according to criteria), intermediary input (enrollment rate, teacher student ratio, class size), output (academic results, graduation rate, dropout rate), result (literacy rate, professional qualifications and skills of the labor force) and impact (impact scope of education program and policy) Allocation norms of local budget expenditure on public education are identified for 01 pupil qualified according to regulation of the education industry in each grade. Accordingly, the allocation norms include all expenditure (salaries, allowances, salaries, contributions, professional expenses…) to carry put teaching and learning activities for 01 pupil in 01 budget year and ensure meeting the regulated norms. 1.3.2.3 Compliance to estimates of local budget expenditure on public education Main contents of management of local budget expenditure on public education in the compliance period include: assigning expenditure estimate and executing 10 budget expenditures according to estimates, controlling expenditure; adjusting estimates; creating the system of reports and midterm evaluation Assigning estimates of local budget expenditure on public education can be done in different methods: First method: The Department of Finance (DOF) assigns budget directly to the Department of Education and Training (DET) and high school (planning unit under provincial management); the Planning Finance Department at the provincial level allocate and assign expenditure for DET Second method: The Finance Department/Planning Finance Department assign budget to departments of education and training (level 1 planning unit) to assign budget for dependent units (high school, preschool, primary school, secondary school level 4 planning unit, budgetusing unit). 1.3.2.4. Final statement of local budget expenditure on public education Final statement of local budget expenditure on public education is the final phase in the management procedure of local budget. The purpose of final statement of local budget expenditure according to input is to synthesize and evaluate all the budgetspending process by expenditure category in a budget tear and provinces adequate information of local budget expenditure management for those who are interested such as: the National Assembly of Vietnam, People’s Councils at different levels, the government, sponsors, the people about the used input. In management of local budget expenditure according to task results, budget using units, management authorities and auditors evaluate results of implementing the industry’s tasks in association with allocated budget for budgetusing unit from the beginning of the year. This is a systematic and relatively objective appraisal process for planning, implementation and results (output) of a project, program and policies that are being carried out or already finished 1.3.3 Influencing factors of management of local budget expenditure on public education Group of objective factors: natural, socioeconomic condition of localities; government’s policies and directions on education development and local education development plan, the system of mechanism and policies of state budget management; characteristics of the education industry. 12 Chapter 2 REALITY OF MANAGEMENT OF LOCAL BUDGET EXPENDITURE ON PUBLIC EDUCATION IN THANH HOA PROVINCE 2.1 OVERVIEW OF SOCIOECONOMIC SITUATION AND PUBLIC EDUCATION DEVELOPMENT IN THANH HOA PROVINCE DURING THE 20112017 PERIOD Thanh Hoa is located in the northernmost part of Central Vietnam. It borders Laos and has a coastline in the Gulf of Tonkin. With a large area compared to Vietnam's cities and provinces, Thanh Hoa's geography is quite diverse, bearing many characteristics of the North and the North Central, and also has its own characteristics. Mountain hill accounts for three quarters of the whole province, creating great potential for forestry economy, abundant forest products and abundant natural resources. Thanh Hoa consists of 2 provincial cities, 1 town and 24 districts, with an area of 11,133.4 km² and a population of 3,712,600 people with 7 ethnic groups of Kinh, Muong, Thai, H'mong, Dao and Tho. Khomu By 2017, there were 2140 schools in the whole province with over 740,000 pupils: 662 preschools, 694 primary schools, 19 primary and secondary schools, 629 secondary schools, 06 secondary high schools, 101 high schools, 28 continuing education vocational training centers, 01 general technology and careeroriented center, and 635 learning centers of communes, wards and towns 100% of communes, wards and towns has commune learning centers During the 20112017 period, the scope of education developed reasonable; the general education quality was improved; results of outstanding pupils at national, international exams and attendance of university exams were always included in the national top list, the basic goal of maintaining the rate of children going to school was reached. The percentages of students going to primary school, secondary school and high school were 100%, 95%, and 6069%, respectively. The rate of children attending school at the right age at all levels also basically reached the set target for the whole period. In particular, the rate of children attending primary school, secondary school and high school at the right age reached over 98%, 9397%, and about 60% (only in 2016 2017 school year reached 805%), respectively. Preschool universalization for 5yearold children was completed in April 2015. Results of education universalization or children in the right age at primary and secondary schools were maintained. 2.2 MANAGEMENT OF LOCAL BUDGET EXPENDITURE ON PUBLIC EDUCATION IN THANH HOA PROVINCE DURING 20112017 13 2.2.1 Management decentralization of local budget expenditure on public education During the 20112017 period, management decentralization of local budget expenditure on public education in Thanh Hoa was implemented according to Resolution No.167/2010/NQHDND dated Dec 08, 2010 and Resolution No. 24/2016/NQHDND dated Dec 08, 2016 of Thanh Hoa People’s Committee Management decentralization of local budget expenditure on public education in Thanh Hoa clearly identifies revenue resources and expenditure category for public education at different levels of local budget, thus enabling levels to proactively implement their tasks However, there exist several shortcomings in the relation between decentralizing expenditure and allocating resources between levels of local authorities, in the authority level to issue mechanism, criteria ad norms for local budget expenditure on public education. Even though expenditure tasks were clearly defined for authoritiy levels, capital for development investment is allocated at the provincial level; as a result, the principle of conformity between resource allocation and tasks among authority levels is not ensured Besides, with the current decentralization mechanism, resources mainly focus on district and commune levels (1115,7% at provincial level, 84,389% in the district’s budget out of total local budget expenditure on public education ), it is difficult for the DET to forecast the required resources for education in the industry’s development planning Authority to issue a number of norms and criteria of local expenditure ở mainly belongs to the People’s Councils at provincial level; while those in lower level (district, town) only have the authority to implement and supervise. 2.2.2 Creating estimate of local budget expenditure on public education The creation of local budget expenditure on public education in Thanh Hoa during the 20112017 period conformed to regulations of the State Budget Law and guideline documents on implementation procedures. There exist schedule and guideline for creating annual local budget estimates regarding content, time and document forms, The People’s Council in Thanh Hoa issued allocation norms for regular expenditure in local budget as the basis for localities and units to crate annual budget estimates Accordingly, there are differences in allocation norms of local budget expenditure on public (cities, towns, Delta regions, low mountains; high mountains) that match with local topographic characteristics, thus helping people in difficult areas to have better access to education. There are several shortming as follows: 14 Guidelines for creating annual budget estimate did not specify macro economic forecast, priority level of target in the industry’s development planning and also lacked specific budget ceiling level for localities and budgeusing units. Estimate of local budget expenditure on public education was created based on mechanism, policies, and norms of expenditure During the 20112017 period, mediumterm budget and budget estimate for the industry were not created. The participation of local education management agency in budget planning was inadequate; there is no close link between planning and budget estimate There are many shortcomings in allocation norms of local budget expenditure on public education. For investment development expenditure on public education, the province has not issued any principle, criterion, allocation norms; the allocation criteria for regular expenditure completely relied on input factors (pupil or assigned personnel). There is no distinction according to quality of providing education services in education facilities Allocation norms of regular expenditure were only calculated based on expenditure norms and price of the first year of the stabilizing period and did not take into account inflation and market fluctuation; as a result it showed many shortcoming in implementation in other years of the stabilizing process (practicality) Mediumterm public investment planning in general and development investment expenditure on education during the 20162020 period in particular still has some shortcomings: there is no specific criterion (in terms of content, priority level) to review and prioritize project selection In investment development plan, public investment plan was divided into groups according to implementation progress (allocating capital for projects with approved estimate, project in transition and newly implemented project), not according to fields so it is difficult to calculate and evaluate the ratio of local budget expenditure on public education Estimate of local budget expenditure on public education basically applied the traditional budget planning method without connection between allocated budget with output or results. During 20112017 in Thanh Hoa, it was based on proposal of education units on salary expenditure, wages, professional expenditure, irregular expenditures. Estimate of local budget expenditure for units in the education industry did not come with commitment in task results in line with allocated budget 2.2.3 Compliance to estimates of local budget expenditure on public education The structure of local budget expenditure on public education has changes that are suitable with local education development orientation and target, thus contributing greatly to the accomplishment of the education industry’s targets 15 Local budget expenditure on preschool, primary and secondary school held the highest ratio and remained stable during the 20112017 period while the ratio of expenditure on high school and other education activties decreased The total amount of local budget expenditure on public education accounted for 21,124,9% of total balance of local budget expenditure. Thanks to the priority, education in Thanh Hoa during 20112017 achieved remarkable results (reasonable development of education scale, increased quality for general education and in mountainous region), universalization of primary education at the right age; early completion of preschool universalization for 5yearold children ) In addition, there are still several shortcomings as follows: The method of assigning estimates of local budget expenditure on public education is still lacking; resources for investment in education from the budget are limited. Financial agencies directly assign budget for budgetusing units in the education industry, leading to excessive intervention into the industry’s operation and the excessive amount of financial management work for the planning unit in financial agencies. On the other hand, education and training agencies not have enough information about education investment.Even thought Thanh Hoa prioritizes resources for education investment, it is a poor province so education budget is not adequate enough to achieve targets and tasks of synchronized education development in the provincial area Monitoring during the implementation process was not really effective. It was mainly dine through reports of budgetusing units but the report quality was still lacking and they did not provide adequate information about results of tasks given in the beginning of the year. Financial institution did not monitor expenditure closely but only check upon having final statement or sometime check once every 6 months.Education and training agencies mainly monitor professional activities; financial monitoring (if only) is mainly done together with when checking professional activities. The main contents for monitoring are checking compliance of mechanism, criteria and norms of expenditure, conformity of payment records and documents without evaluating operational efficiency or associating responsibility of unit leaders in using financial resources for task results. 2.2.4 Final statement of local budget expenditure on public education Final statement of local budget expenditure on public education inThanh Hoa during the 20112017 period was done according to regulation of the State Budget Law in terms of procedures, documents, statistics and reports 16 However, it mainly carried out the content of financial final statement. Procedures of approving final statement are still complicated and cumbersome; data in final statements did not reflect task results of units Contents of final statement mainly stopped at comparing data to ensure confirmation and matching of expenditure without evaluating compatibility between the assigned financial resources and the task results of the localities and units The approval process of final statements was still complicated because of the presence of too many agencies in the tasks. The process took a long time Data in financial statements of planning unit were mainly collected according to the principle of correctness, honesty and adequacy; they did not synthesize and report task results as planned. Chapter 3 ORIENTATIONS AND SOLUTIONS TO IMPROVE MANAGEMENT OF LOCAL BUDGET EXPENDITURE ON PUBLIC EDUCATION IN THANH HOA 3. EDUCATION DEVELOPMENT TARGETS AND ORIENTATIONS, VIEWPOINTS TO IMPROVE MANAGEMENT OF LOCAL BUDGET EXPENDITURE ON PUBLIC EDUCATION IN THANH HOA PROVINCE UNTIL 2025 WITH VISION TO 2030 3.1.1 Education development targets in Thanh Hoa 2025 with vision to 2030 As stated in Decision No.4295/QDUBND dated Nov 09, 2017 on approving the implementation plan of education and training’s sustainable development target in Thanh Hoa until with vision to 2030 [71], Thanh Hoa aims towards establishing high quality, fair and comprehensive education foundation and promote lifelong education for everyone. On that basis, specific targets are identified as follows: increasing access to people; taking care and providing quality education to children; carrying our education and training that ensure fairness and eradicate imbalance with vulnerable targets; creating a learning society; providing necessary skill and knowledge for learners to promote sustainable development; creating a safe, nonviolent, comprehensive and effective learning environment for everyone; educating and increasing awareness and ability to cope with climate change and alleviate disasters. These targets are concertized into a system of specific monitoring and supervision indicators 17 3.1.2 Orientations and viewpoints of management of local budget expenditure on public education in Thanh Hoa until 2025 with vision to 2030 3.1.2.1 Orientations to improve management of local budget expenditure on public education in Thanh Hoa Firstly, management of local budget expenditure on public education needs to contribute to the establishment and maintenance of strict fiscal budget in local budget management Secondly, management of local budget expenditure on public education aims at allocated limited resources for identified targets and missions according to priority order in local education development plan Thirdly, management of local budget expenditure on public education must fundamentally improve the efficiency og using budget at budgetusing units in the education industry Fourthly, it is necessary to improve quality in all processes related to budget, especially the quality of creating estimates of local budget expenditure on public education, tighten discipline to comply with estimates and accountability, attach responsibilities of individuals and organizations in the process of allocating and using local budget for public education development. 3.1.2.2 Viewpoint to improve management of local budget expenditure on public education in Thanh Hoa Firstly, management of local budget expenditure on public education needs to continue to adhere to fundamental and comprehensive reform of education and training according to Resolution No.29NQ/TW dated Nov04, 2013 of the Central Committee. [5] Secondly, management of local budget expenditure on public education needs to adhere to the financial management reform viewpoint of the country in general and of the province in general Thirdly, management of local budget expenditure on public education needs to aim towards task result and ensure all local education development targets During the 20112017, there exist many shortcomings in management of local budget expenditure on public education in Thanh Hoa: management was mainly done according to input factors; the organization and assignment of human resources in education units are still lacking; the redundancy or shortage of internal workforce is still present. Therefore, the management reform of local budget expenditure on public 18 education requires specific Road map to avoid haste in changing management methods and achieve the highest results of implementation. Each solution needs to be analyzed to identify conditions of implementation so that the correct level of implementation is applied 3.2 SOLUTIONS TO IMPROVE MANAGEMENT OF LOCAL BUDGET EXPENDITURE ON PUBLIC EDUCATION IN THANH HOA 3.2.1 Group of main solutions 3.2.1.1 Improving management decentralization mechanism of local budget expenditure on public education in Thanh Hoa The management decentralization mechanism of local budget expenditure on public education in Thanh Hoa until 2015 with vision to 2015 can be improved in the following directions: Regarding development investment expenditures: increasing resources for development investment expenditures in line with the government’s socioeconomic management decentralization and spending tasks at level according to the principle: if a project is managed by a specific level of authority, budget expenditure management will be done in that level. The coordination mechanism between the Department of Planning and Investment (DPI) and the Department of Finance (DOF), between the DPI with the People’s Committees in towns, districts, and cities is established to provide information about the industry’s development plans and resource capacity for education to improve the efficiency of decentralization mechanism. 3.2.1.2 Building allocation norms/Improving allocation mechanism of local budget expenditure on public education according to task results For regular expenditure: For allocation mechanism of local budget expenditure to truly contribute to improving the efficiency of management of local budget expenditure on public education in the province, the following should be done: Firstly, selecting pupils as the objects to create allocation norms of regular state budget expenditure for the education causes Secondly, adjusting the coefficient of priority allocation by region and by level (minimum of 20%) To create allocation norms according to task results, the following contents need to be carried out: 19 Identifying norms of public education expenditure for teaching and learning activities for 01 pupil in 01 year according to each region (cities, towns, Delta region, mountainous area) with consideration of the impact of changes in salary policies and Customer Price Index Identifying tuition fee level for each region and grade with consideration of CPI according to Resolution No 86/2015/NDCP dated Oct 02, 2016 of the government Identifying allocation amount of local budget for 01 pupil Usinf “pupil” as the allocation criteria, the allocation norms of local budget is calculated based on teaching cost and tuition fee/01 pupil/year as the difference between cost for teaching actitivies/01 pupil/year and tuition fee/01 pupil/year. In addition, allocation norms of local budget on public education will be adjusted according to fluctuation of CPI and in consideration of economic conditions in each residential area as well as people's contribution ability Road map for implementation: For now, the allocation of local budget on education causes difficulties for the local budget because thrre is no appropriate planning of education facility network, redundancy of shortage of teachers or lack of pupil attendance These shortcomings can be overcome by adding budget for specific targets in a certain period of time. It is necessary to calculate that time period so that the education industry can rearrange its network and workforce and have an appropriate Road map for change. In the first phase, allocation of local budget expenditure on public education can be done according to combined criteria, for example: allocation according to personnel regarding salaries, allowances, salary items and salary contributions; allocation of professional cost according to the number of pupils each year. Individual expenditure for personnel as above can be calculated according to salary policies and preferential policies for teachers, regions with extremely difficult socio economic conditions according to the government’s regulations. Allocation of professional expenditure is done annually on the basis of ensuring adequate cost for professional activities (textbooks, course books, materials ), and expenditure for management and; the ratio of processional expenditureindividual expenditure is at least 20:80. In the next phase, after the network of schools and personnel at levels are re arranged, the education industry will apply the allocation norms of local budget expenditure using pupil as the criteria and apply the mechanism of assigning tasks 20 and ordering education service appropriately. For development investment expenditure For the education industry, population is chosen as the criterion for allocating budget for investment. Priority should be given according to region, especially those in difficult socioeconomic conditions, in line with priority for regular expenditures as mentioned above. Based on the local target of increasing material infrastructure for education until 2025 with vision to 2030, the industry collects proposals of units regarding tasks in building infrastructure for each grade and budget level with specific road map. Based on that, the DET works with the DPI to build criteria for selecting investment projects. The DPI needs to take the lead in creating principle, criteria and allocation norms of investment development capital from state budget in Thanh Hoa in general and for public education in particular to increase resources and independence of localities in implementing their development targets. Criteria to evaluate and arrange priority order for projects in mediumterm planning include: compatibility; ability to mobilize other capital sources; operation and maintenance capability; efficiency 3.2.1.3 Improving quality of financial planning – mediumterm budget of the education industry The following methods need to be carried out in a synchronized manner: Firstly, the DET established a consulting nut on mediumterm financial budget planning for the education industry; it is possible to invite representatives from the Department of Finance as a member. The unit includes competent members that are trained in forecast, development planning, forecast of demand of local budget expenditure on public education and understand the method and process of building mediumterm financial planning. Secondly, it is necessary to define tasks of each agency, unit, and government level in carrying out targets; it should be institutionalized in the provincial plan to enhance the responsibility in implementation organization Thirdly, financial agencies should improve quality of evaluating plans. Fourthly, budgetusing education units should enhance the quality of building financial – state budget planning for 3 years Fifthly, improving leadership role of People’s Committee at levels and monitoring role of People’s Councils at level, awareness and competency of education management agencies (department/unit of Education and Training) and 21 planning unit in at provincial level) in renovating planning method in general and mediumterm financial budget planning in particular. . Implementation Road map: in carrying out Decree No.45/2017/NDCP dated Apr 21, 2017 detailing the formulation of fiveyear finance plans and threeyear financestate budget plans, the province formed the threeyear financestate budget plan for 20182020 and is now building plans for 20192021. To improve the quality of threeyear financestate budget plans, DET and units can implement this solution in 2019 to build plans for 20202022 and provide criteria for forming five—year plans for 20212026 3.2.1.4 Closely associating the industry’s development plan and estimate of local budget expenditure on public education For the education industry in Thanh Hoa, to closely link plans with financial resources, plans need to play the directing role for allocation of financial resources; in turn, estimate of local budget expenditure needs to comply with priorities stated in the industry’s planning. To do so, the following conditions must be ensured: Firstly, planning must display its strategic nature in identifying targets and solutions. Secondly, priority is given in state budget resources to carry our prioritized solutions Thirdly, planning must ensure the participation of related parties The following solutions need to be carried out in a synchronized manner: Firstly, guidelines on creating annual estimates of the DPI and DOF need to show specific criteria in selecting project and priotized tasks in the year of estimate and during the threetear period. Secondly, participation of the DET should be increased in discussing estimate of local budget expenditure on public education with units and localities (districts, towns, cities) Thirdly, building coordination mechanism among MOF, DET and localities in building estimate of local budget expenditure on public education Fourthly, building estimate proposal sample to discussion about estimate among financial agencies and units. Implementation Road map: timing is already over for discussion and formation of local budget estimate for 2019 and threeyear financestate budget plans for 20192021.Therefore, when creating guideline documents for local budget expenditure estimate on public education in 2020, the role and task of the DTE can be institutionalized as the basis to carry out solutions 22 3.2.1.5 Improving quality of implementing local budget expenditure estimate on public education The following solutions need to be carried out: Firstly, continue to priotize resources from local budget for education development and allocate expenditure from local budget (both investment and regular expenditure) for budget levels in line with assigned tasks as in 3.2.1.1 Secondly, change the mechanism of assigning local budget expenditure on public education. Specifically: For expenditure estimate of high schools: The Department of Finance assigns expenditure estimate for the DET to allocate and distribute estimates to units. For preschools, primary schools and secondary schools: the finance and planning unit at district, town, city levels assign estimates to the education and training unit to distribute to units. Thirdly, increase freedom of budgetusing education unit Fourthly, increase monitoring activities for local budget expenditure on public education and provide midterm evaluation report Implementation Road map: increase in freedom for budgetusing education units was institutionalized in the ogvernmenr’s documents (Resolution No.29 NQ/TW dated Nov04, 2013 of the Central Committee., Resolution No. 16/2015/NĐ CP dated Feb 14, 2015 of the government; therefore implementation can be done in the 2019 budge year and 20192020 school year. The increase in monitoring and mid term evaluation report can also be done in the middle of 2019 budget year. 3.2.1.6 Creating the monitoring system to evaluate the level of accomplishing tasks Based on local education development planning, the following information can be applied in task criteria, monitoring criteria Group of criteria to monitor and evaluate the efficiency of local budget expenditure on public education : For budgetusing unit of the education industry, possible criteria are: + The number of pupils completing education programs according too regulations of the Ministry of Education and Training + Number of graduated pupils + Number of graduated pupils following with higher grades 23 + Ratio of dropout + The unit cost in providing the output for a graduates pupil or a student completing training program of a class group (all expenses to implement educational activities on 01 student 01 academic year / course, including: expenses for people, fixed asset depreciation expenses, expenses for professional activities, other expenses); + Local budget expenditure on public education at the unit + Local budget expenditure on public education calculated for 01 graduated pupil or a pupil completing the learning program. For localities, possible criteria to evaluate the efficiency of local budget + The number of pupils completing education programs according to regulations of the Ministry of Education and Training + Number of graduated pupils + Number of graduated pupils following with higher grades + Ratio of dropout + The unit cost in providing the output for a graduates pupil or a student completing training program of a class group (all expenses to implement educational activities on 01 student 01 academic year / course, including: expenses for people, fixed asset depreciation expenses, expenses for professional activities, other expenses); + Local budget expenditure on public education; + Local budget expenditure on public education calculated for 01 graduated pupil Group of criteria to evaluate efficiency of local budget expenditure on public education : To evaluate results of implementations, the following criteria should be used: the number of 5 yearold children completing preschool universalization programs. number of pupils graduating from school (primary, secondary, and high school) in companies; the ratio of children in nursery and preschool education; ratio of malnutritious children in preschool education facilities, ratio of children attending general education at the right rate; rate of primary and and secondary school universalization; ratio of children graduating from high school and following with university education or vocational education; the rate of children with disabilities attending school; rate of literate people aged 15 and over and literacy rate between 15 and 35 years old Road map for implementation: the government has not issued guidelines of state budget management according to task results so localities can take initial steps of monitoring output, evaluating results of implementation through the ratio of pupils 24 meeting output standards in different grades compared to target. From that, they can evaluate the level of implementation through compared with target set out in each timeline (2010, 2015) 3.2.1.7 Increasing the participation of the industry’s management agency in management of local budget expenditure on public education Education and training agencies need to take the main role in consulting levels of authority in allocating state budget for this field To ensure the responsibility of explaining task results, education and training management agencies to have more say in allocation and monitoring of budget of authority levels. Besides, to increase the role of education management agency in associating allocated resources with task results, it is necessary that the DPI is given more freedom. That way, close connection between rights and responsibilities, between tasks and factors to ensure implementation can be created, helping the ETD to be proactive and flexible in managing professional activities. Road map for solution implementtion: as analyzed in 3.2.1.1 and 3.2.1.4, increase in participation and role of the education and training industry can be done right from palanning of local budget for 2020 Study can be done about the institutionalization of the industry's role in budget process to be applied in the new phase of stabilization in 20212025. 3.2.2 Group of supporting solutions: Adjusting tuition fee in preschool and general education according to Decree No. 86/2015/NDCP dated Oct 02, 2015 of the government; encouraging socialization of education to increase investment resources in providing services; increasing competency of financial management officer in financial agencies at levels and in planning unit of the education industry; improving transparency and financial management of planning units 3.3 Some recommendations: the thesis presents some recommendations to the government, People's Council, People’s Committee in Thanh Hoa to create favorable conditions to implement solutions CONCLUSION With the aim of systemizing and developing theoretical issues about management of local budget expenditure on public education and proposing a number of solutions to improve management of local budget expenditure on public education 25 in Thanh Hoa, the author choose “Management of local budget expenditure on public education in Thanh Hoa province” as the study content The thesis focuses on studying main contents of management of local budget expenditure on public education and presents a number of new contributions to achieve the study purposes, specifically: The thesis systemizes and clarifies contents of management of local budget expenditure on public education (management decentralization of local budget expenditure on public education, estimate creation, estimate compliance, final statement of local budget expenditure on public education) when managing budget according to input and according to task results. On the basis of studying contents of management of local budget expenditure on public education, the thesis studies experiences in several countries in the world and in several local provinces to draw lessons for Thanh Hoa. This serves as an important practical basis to propose solutions for improving management of local budget expenditure on public education The thesis also focuses on analyzing the reality of management of local budget expenditure on public education in Thanh Hoa in the following content via analyzing secondary data during the 20112017 period: management decentralization, estimate planning, estimate compliance, final statement of local budget expenditure on public education in Thanh Hoa. From that, the thesis presents comments about the reality of management of local budget expenditure on public education in Thanh Hoa with the biggest shortcomings as follows: budget allowances are based on input factors; budget planning is not associated with the industry’s development plan; budget planning is done annually; final statement of budget only evaluates compliance without auditing of activities, assessing efficiency and validity of local budget expenditure on education The thesis also points of reasons of these shortcomings as the basis to propose solutions The thesis analyzes the context of fundamental and comprehensive reform of education and training according to Decree No.29NQ/TW dated Nov04, 2013 of the Central Committee and series of changes about management mechanism of state budget in general as well as regulations on finance, financial management in education in particular;from that the thesis propose viewpoints and solutions to improve management of local budget expenditure on public education in Thanh Hoa. Of which, the main groups of solutions are: improving the decentralization mechanism of management of local budget expenditure on public education; 26 improving the allocation mechanism of management of local budget expenditure on public education according to task result; improving the quality of mediumterm financial and budget planning for the education industry; associating education development plan with expenditure estimates of local budget for public education; improving the quality of implementing expenditure estimates of local budget for public; creating a monitoring system to assess the level of task accomplishment; increasing the participation of education management agencies in management of local budget expenditure on public education In addition, the thesis presents proposals and recommendations to the government and authorized local agencies (People's Council, People’s Committee in Thanh Hoa) to create favorable conditions to implement solutions to improve management of local budget expenditure on public education The thesis results have practical importance for management of local budget expenditure on public education in Thanh Hoa and other provinces with similar conditions. Analyzed results and proposals in the thesis serve as good directions for units carrying out management of local budget expenditure on public education in Thanh Hoa (financial, education and training agencies) to reform management method, improve the management efficiency of local budget expenditure on public education in Thanh Hoa. In addition, proposals and recommendations in the thesis also help the government and related ministries and industries in their orientation to improve legal framework of state budget expenditure management in general and management of local budget expenditure on public education in Thanh Hoa in particular ... of ? ?local budget expenditure on public education? ? in case of? ? managing? ?local? ?budget? ?expenditure according to input include the expenditure rate? ?of? ? local? ?budget? ?for? ?a group? ?of? ?tasks (salaries, training….)... 1.2.1 The concept? ?of? ?local? ?budget? ?on? ?public? ?education Local? ? budget ? ?expenditures on public education? ? are expenditures to ensure activities? ?of ? ?education, including: maintaining regular activities? ?of? ?the industry (for? ?... school level 4 planning unit, ? ?budget? ?using unit). 1.3.2.4. Final statement? ?of? ?local? ?budget? ?expenditure on? ?public? ?education? ? Final statement? ?of? ?local? ?budget? ?expenditure on? ?public? ?education? ?is the final phase? ?in? ?the management procedure? ?of? ?local? ?budget.