CCPA Policy Note

How to fund improvements in class-size and composition: a matter of political will

June 3rd, 2014 · · 28 Comments · Children & youth, Education, Taxes

If a compromise is to be reached in the current bargaining between teachers and the government, the long-standing issue of improving class-size and composition must be resolved.

The government insists that there is no money to make substantial improvements in this area (notwithstanding multiple court losses telling the province that it must make good on this matter).

But is it really so hard to find the funding to reduce class sizes and ensure adequate ratios and supports for students with special needs?

In truth, it’s a matter of political choice.

According to estimates from the BC treasury, the cost of restoring class size and composition to where it was five years ago is approximately $300 million. That’s quite a lot more than the government currently has on the table to deal with this matter. So where could the money come from?

Last year, Iglika Ivanova and I wrote a report entitled Progressive Tax Options for BC, which outlined a host of scenarios for how the province could raise new revenues. Any number of them would produce the needed $300 million.

For example, if the current 5th income tax bracket in BC (which only affects people earning more than $103,000 a year) were to increase from 14.7% to 17%, the province would raise about an additional $375 million a year. Notably, under this scenario, most people making over $103K would see only modest increases in their taxes. Heck, even someone making half a million dollars a year would see an increase in their tax bill of only about $9,000 (or 1.8% of their total income).

Alternately, if the government created a new tax bracket that kicked in at incomes over $200,000 a year (set at 21%), it would also raise over $300 million. That would only impact the wealthiest 1% of BC taxpayers.

But the options for how to structure new upper-income taxes are many.

And an added benefit – these tax options don’t only raise the money needed to substantially improve class size and composition. They do so in a progressive manner, meaning, they simultaneously help to reduce inequality and restore fairness to our overall tax system.

Indeed, there is a poetic logic to funding educational improvements in this way. As recent studies have noted, rising inequality undermines social mobility and equality of opportunity. Meaning, the more unequal a society is, the harder it is for people (and their children) to move up (or down) the income ladder – a reality that has led British epidemiologists Richard Wilkinson and Kate Pickett to propose that if Americans really wanted to live the American dream of “rags to riches”, they have to move to Denmark or Sweden. Similarly, Canadian economist Miles Corak, a leading expert in this area, has found that inequality undermines social mobility, and notes that a key mitigating factor are public goods, notably public education.

So why not increase taxes on wealthier people in order to fund education improvements that are particularly important to lower income people and kids with special needs? It has the double benefit of reducing inequality, while enhancing equality of opportunity.

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    28 Comments so far ↓

    • Government agrees to mediation !

      […] “There’s simply no money” argument debunked Seth Klein and Iglika Ivanova from the Canadian Centre for Policy Alternatives have well-thought out solutions to the perceived cost problem. Read their blogs here and here. […]

    • Patricia

      A couple of things. What about returning the tax on banks? The second, can we flip the equation and put a figure to the impact of an under educated generation?

    • Media Mornings: Wed, June 18 — Education Undermined? — Iglika Ivanova (CCPA) — Karen Shortt (VCC Faculty Association) — Stephen Von Sychowski | Media Mornings / Democracy North

      […] how BC can increased funding to education, and argues that teacher demands are reasonable.  A matter of political will. (starts at 45 min […]

    • How to fund improvements in class size and composition: a matter of political will | The Child and Youth Advocate

      […] this thoughtful article in Policy Note Seth Klein of the Canadian Centre for Policy Alternatives BC Office asks, “Is it really so […]

    • Mike Stewart

      I heard on CBC the other day that someone has calculated that corporations in (I think it was North America, not just Canada) are sitting on $160 TRILLION-plus of profits. That is simply a staggering sum! What possible need can this corporate hoard be serving?
      Meanwhile, Canadian companies are lagging in R & D – expecting government to do it for them, sending jobs offshore, bringing in TFW’s to take work away from Canadians, and on and on. Yes, let’s tax that stash; it the corp’s can’t figure out how to use it, we can!
      One other way to “find” some dollars to address inadequate levels of funding in public services; Ban all government advertising except that actually needed to do the work of gov’t, eg – advertising public hearings, seeking missing people for estate or court purposes, etc. That $26million the Libs blew to toot their political horn before the last election would have been a good start at resolving the class size question.

    • DaveS

      While a look at BC taxation historical record says that the proportion of the overall tax take from corporations has been diminishing over the past decades, the taxation strategy has remained: lower taxes for corporations to attract business (and in theory, jobs) to BC. Unfortunately the strategy hasn’t matched the revenue returns, presumably the primary standard for taxation strategy. Also, and more importantly, all provinces in Canada compete with each other by lowering taxes to attract businesses and no doubt this dog-and-pony show effect provides lower taxes and even subsidies to the corporate world. There is little analysis of value for money of this strategy, which will ultimately continue to reduce corporate taxes to zero over time due to competition. Corporations don’t have to return profits to the local community where they operate – their shareholders don’t even have to live in Canada. They don’t have any allegiance to BC other than BC being the location from which they wish to make a profit.

      Funding for education is a local mandate in Canada, partially funded from municipal and provincial/territorial budgets. As provinces compete with each other for funding, they are “topped up” by federal liaison, which must be quite a sticky political process, especially for those provinces whose social philosophies run counter to what’s popular in Ottawa.

      Then you add the municipalities funding, which appears to be overrun by developer ambitions, and a large proportion of actual funding goes towards capital intensive earthquake readiness construction projects – surprise, surprise! Developer-funded appointees overstate the risk of earthquake disaster and cost-benefit analysis is scant with details and reckless with opinion.

      Isn’t it obvious we need to spend more money on our teachers because most of us can’t even think of these factors very clearly?

    • Starla

      Numbers, numbers, numbers . . . we’re talking about individual children who will feel confident about finding a place in the work force when they leave secondary school. Whether they’re headed to Oxford to become scholars or to restaurants to be chef’s helpers, they will be able to make a contribution to society. It is NOT all about achievement; it is as much about a sense of self that comes from participating in classroom activities with peers with the guidance of teachers who help children learn about the give-and-take of life in a functioning democratic society. This is what matters – maybe even more – than achievement levels determined by standardized tests. And this is why class size and composition are vital to any learning environment – public or private. Raise taxes by 1% on corporate profits and the BC Supreme Court ruling will easily reinstate the contract that was broken in 2002. And for those who choose to have their children educated in private schools, the public should not be contributing any per student funding. Public funds (taxes) are for public institutions and are clearly needed to keep our public schools able to prepare every child for what their future holds.

      • Al smith

        Right on Starla! To many kids, school and their teacher relationships are the OT safe encouraging time of their day. No system is perfect. Patents are not perfect. Our own communities pass off the raising of children to schools and then Government abuses the very caring people who help! Unions are not the enemy. Just a body trying not to be extinguished or bullied.

    • DeceitinDrugs

      More funding is not the entire answer but,
      funding per individual special needs child.

      A lot of funding not utilized efficiently by school districts.

      • VJGrimes

        I think there is money, and private schools receiving “their” school taxes is a notion that bugs me. Speaking to parent, a care aid, that sends her children to private school–I pointed out their teachers will be glad if public school teachers get a raise–because they will too, and why not? teasing her that they would not underpay fully-qualified teachers!? Her response was, “No, because parents pay their wages.” She seemed under the impression they PAY the whole shot.

        A private school principal on TV news suggested “Private schools are half-the-price per student,” a bargain. However only regular students can go there–child with learning difficulties can’t apply–except for special-ed-focus private schools. So regular students educated privately are taking half the funding they would “get” in public school, but the average student does not need as much. Assume half is MORE than enough; the bargain seems given to private schools.

        Smaller classes are best for private school students. A reason their teachers get paid less. I had a friend who enjoyed teaching in the private system, his music program was given lavish sums of money for whatever their needs were, for two years–he was so impressed by the interest of parents and administration. Principal had a friend though, who fit the job, so my acquaintance got bumped from the position. He said the pay was less than public, but supports and class sizes made up for a lot. However working for the-man, it was someone else’s time.

      • Pam

        Believe me, DeceitinDrugs, there are very few inefficiencies in school districts these days. Every penny is needed and carefully used. No one can afford even the smallest waste anymore, so actually I believe more funding IS pretty much the ‘entire answer’. School districts have been increasingly starved for funds over the last 12 years.

    • Jim

      This government is all about big business…it no longer wants to support public education and they are lying throughout their venires when they indicate or say anythinng different. Fassbender looked like a complete jack-ass on global TV the other day saying that Kindergartens are evaluated when the truth is that evaluation does not come until a child is in grade 3. He also stated that class size has nothing to do with achievement when in actuality the research supports and show the opposite – class size and composition are inseparable and cannot be excluded from one another.

    • Hard Worker

      So your solution is take money from the other guys….that works well unless you are the other guy. I came from a single income family and my Dad was in a union. I worked my ass of in school and in work. I am in a profession that rewards hard work and results. My compensation reflects that. Why would I agree to give you more of my money when I already pay considerably more taxes on a percentage and absolute basis? That isn’t fair either. IF YOU ARENT HAPPY WITH YOUR PAY AND?OR WANT MORE MONEY SPENT ON PROGRAMS DON”T TARGET A MINORITY GROUP TO PAY FOR YOUR DESIRES

      • VJGrimes

        I read it differently than you … what I thought they said was, take a pinch off TOP earners. Corporations are top earners, as are their shareholders potentially. Resources sector is apparently earning more than ever and being taxed less than before!? e.g. EARNINGS 2001 $2.65 billion, earnings 2013 $7.982 billion. Revenue contributed to TAXES 2001 $4.2 billion, 2013 $2.5 billion (i.e. wrong direction …) Maybe “top earners” are resource businesses, along with shareholders who get a cut of profits, dividends, each year? Idea is, if resources sector contributed more there IS more. Maybe they will contribute more–with the new LNG jobs programs, which is a good thing, they’ll hire and train the workers–or maybe it is that they’ll hire the trained workers … yes, paying workers is “making a contribution.” Meantime, taxes on income can level things–not YOU and your pay cheque alone, but all types of income.

      • Seth Klein

        Actually, check out the report I link to in the post above (Progressive Tax Options for BC), and see Figure 1 on page 17. What it reveals is that BC’s overall tax system is currently out-and-out regressive. Meaning, the more you make, the LOWER your overall tax rate in BC. Yes, income taxes are progressive (the more you earn, the higher your tax rate), although less so than they used to be. But all the other taxes we pay are regressive, leaving the overall system similarly regressive.

        But as an aside, maybe you are right that we shouldn’t only be asking the wealthy to pay more. Many of us can and should. And as polling the CCPA did with Environics in 2012 revealed, 52% of British Columbians say they themselves would be willing to pay more in taxes to fund reductions in class sizes in the K-12 system. A good news finding.

        • Laure

          I think we all have come to realize, long ago, that there have always been common-sense solutions to public funding, and not just for schools. But human nature prevails – greed and avarice always seem to win the day, with society’s most vulnerable suffering for it.

    • Simon

      Part of the $2 billion dollar number is that when BCPSEA looks at over sized classes, they presume that every oversized class would require one new teacher hired to the system.

      In reality, a school with 5 oversized classes might only have 15 students comprising those overages. That can easily be resolved by hiring one new teacher, not the 5 that is being used for the calculations.

      Similarly, when they cost out the BCTF benefit proposals, they presume that EVERY teacher in the province will use ALL of their entitlement to sick days or to bereavement leave. I don’t know about you… but I only have so many relatives. I suspect I will not lose one a year, for every year of my career.

    • Nancy Knickerbocker

      You are right that in the media Clark and Fassbender are claiming that restoration of class size and composition costs $2B. Yet in BC Supreme Court gov’t reps testified that it would cost $300M.

    • Jeremy

      Thanks so much for that blog. Even if the numbers are different than the govt’s spin, an extra 300 to 375 million would add up nicely.

      Tax those who can it afford it the most–so simplistic….

    • Guy in Vic

      ” The government has said restoring class sizes and composition to 2002 levels would cost $2-billion. ”
      (G&M)

      Yet you suggest it would cost $300 million. Why the huge difference ?

      Guy in Vic

      • CW

        In a nutshell, the government is lying. Closest you could get to their figures would be to total the costs from 2002 onward, adding compound interest over the duration at usurious rates. You could call that the “payback is a bitch” scenario. While some might see merit in such an approach, that’s not really what’s on the table.

      • Laurie

        Could it be because the government is really good at huge deceptions?

      • Seth Klein

        Hi Guy.
        I’m not sure how the government gets its $2 billion figure. But I suspect it is an exaggeration (part of how this plays out in the media). Likely they are tallying the cost over multiple years (perhaps the proposed six-year life of an agreement).
        Seth

    • Jack Stevens

      I have long argued for a progressive tax which benefits everyone in the community.
      ‘A rising tide floats all boats’

      • Jim

        This government is all about big business…it no longer wants to support public education and they are lying throughout their venires when they indicate or say anythinng different. Fassbender looked like a complete jack-ass on global TV the other day saying that Kindergartens are evaluated when the truth is that evaluation does not come until a child is in grade 3. He also stated that class size has nothing to do with achievement when in actuality the research supports and show the opposite – class size and composition are inseparable and cannot be excluded from one another.