Page 3 - IDEA Study 4 2017 Public financing for pre-school places

Study 4 /2017

Public financing for pre-school places
pays off: a cost and benefit analysis1

MARCH 2017

KLÁRA KALÍŠKOVÁ, DANIEL MÜNICH, FILIP PERTOLD

Summary

 Nationwide statistics suggest that the long-term shortage of places in public pre-school
institutions (pre-schools) has become gradually less severe over the past few years
thanks to population decline, and that in future there will be sufficient places available
at pre-schools. Nevertheless, at the local level demand is still far outstripping supply
in many places, and this is unlikely to change as internal migration and other
demographic changes continue.

 Our analysis of financial costs and benefits reveals that the shortage of places in pre-
schools in the past decade has led to an undeniable net loss for public budgets. Our
analysis demonstrates that the net gain to public budgets from every additional place
in pre-school amounts to an average 10,000 CZK per year. Public financial support for
pre-schools would not result in a loss even under very conservative estimates.
On the contrary, the net gains are in fact far higher if the indirect and long-term
consequences of supporting further places in pre-schools are taken into account.

 If we include families' private gains in the form of higher income, both as an immediate
effect and in the future, the improvement of quality of life, young people's greater
willingness to have children given the relative ease of combining parenting with

1 The authors wish to convey their sincere thanks to Aleš Chmelař for providing an initial basic version of
the cost and benefit analysis, to Vladimír Hulík for verifying the entry data used from regional school
statistics, and to both for their valuable comments on earlier versions of this study. All opinions, possible
omissions and errors, and any incorrect assumptions or interpretations in this work are the authors' sole
responsibility.

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