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Social Sphere According to preliminary estimates, in 2010 the population paid nearly RUB 65 bln for paid services in the system of secondary vocational education, and more than RUB 160 bln for higher and postgraduate vocational education.

1154,1135,1105,1042,886,737,593,191,7 191,8 187,177,160,134,118,2004 2005 2006 2007 2008 2009 Consolidated budget for education adjusted for inflation Percentage of paid services in the educational system adjusted for inflation Fig. 15. Dynamics of budgetary expenditures and paid services for education 20042010 adjusted for inflation.

Dynamics of budgetary expenditures on education To get a better picture, let us compare budgetary expenditures by level of educational system. The size and structure of such expenditures in 2004 2010 are shown in Table 11.

Table Size and structure of expenditures of the consolidated budget for education by level of the educational system in 2004 2004 2005 2006 2007 2008 2009 1 2 3 4 5 6 7 Consolidated budget for education, bln RUB 593,4 801,8 1036,4 1342,3 1664,2 1783,5 1893,Preschool education (PE), bln RUB 91,7 113 145,3 189,7 254,5 287,5 321,A share of expenditures on PE in the consolidated 15.5 14.1 14.0 14.1 15.3 16.1 17.budget for education, % A share of expenditures on PE as % of GDP 0.54 0.52 0.54 0.57 0.61 0.74 0.Growth rates of budgetary expenditures on PE, % 123.2 128.6 130.6 134.2 113.0 111.General education (GE), bln RUB 298,1 356 475,9 599 737,1 795,7 827,A share of expenditures on GE in the consolidated 50.2 44.4 45.9 44.6 44.3 44.6 44.budget for education, % A share of expenditures on GE as % of GDP 1.75 1.65 1.77 1.80 1.78 2.04 1.Growth rates of budgetary expenditures on GE, % 119.4 133.7 125.9 123.1 108.0 104.Elementary vocational education (EVE), bln RUB 35,6 39,4 47,4 57,6 65,5 66,8 61,A share of expenditures on EVE in the consolidated 6.0 4.9 4.6 4.3 3.9 3.7 3.budget for education, % A share of expenditures on EVE as % of GDP 0.20 0.18 0.17 0.17 0.16 0.17 0.Growth rates of budgetary expenditures on EVE, % 110.7 120.3 121.5 113.7 102.0 92. bln RUB RUSSIAN ECONOMY IN trends and outlooks (continued) table 1 2 3 4 5 6 7 Secondary vocational education (SVE), bln RUB 30,5 43,3 55,3 70,4 93,9 102,2 102,A share of expenditures on SVE in the consolidated 5.1 5.4 5.3 5.2 5.6 5.7 5.budget for education, % A share of expenditures on SVE as % of GDP 0.18 0.20 0.21 0.21 0.23 0.26 0.Growth rates of budgetary expenditures on SVE, % 142.0 127.7 127.3 133.4 108.8 99.Higher and postgraduate vocational education 76,9 125,9 169,9 240,2 294,6 347,2 377,(HVE), bln RUB A share of expenditures on HVE in the consolidated 13.0 15.7 16.4 17.9 17.7 19.5 19.budget for education, % A share of expenditures on HVE as % of GDP 0.45 0.58 0.63 0.72 0.71 0.89 0.Growth rates of budgetary expenditures on HVE, % 163.7 134.9 141.4 122.6 117.9 108.Source : Federal Treasury.

As illustrated in Table 11, a share of budgetary expenditures on general education in GDP increased until 2009 and slightly decreased in 2010. A share of budgetary expenditures on preschool education in GDP increased almost by one third over the period under review.

However, basic growth in this indicator was reported in 2009, when the Russian GDP decreased considerably.

A share of budgetary expenditures on elementary and secondary vocational education in GDP remained stable in the period between 2004 and 2010, whereas a share of expenditures on higher and postgraduate vocational education in GDP grew steadily throughout the entire period, from 0.45% in 2004 to 0.88% in 2010, which means that they doubled.

In the period between 2004 and 2010, a share of expenditures on preschool education in the consolidated budget for education increased (likewise in GDP), whereas a share of expenditures on general education decreased in 2005 and then remained stable.

At the same period, a share of expenditures on EVE in the consolidated budget for education gradually decreased, which can be explained by integration of a part of EVE and SVE institutions which were transferred under the jurisdiction of the constituent territories of the Russian Federation.

A share of expenditures on secondary vocational education in the consolidated budget for education remained stable throughout the entire period, and even tended to slightly increase over the recent years.

A share of expenditures on higher and postgraduate vocational education in the consolidated budget for education increased visibly from 13.0% to 17.9% in the period between and 2007, slightly decreased in 2008, and then resumed to grow, reaching a growth rate of 19.9% in 2010.

In general, one may infer that budgetary expenditures on higher education relatively increased as expenditures on school education remained stable, and expenditures on non-higher vocational education decreased.

It should be noted that growth rates in general education (like at the other levels of education) were considerable in 2004 2008, whereas decreased dramatically in 2009 2010, which can be explained by the global recession. However, these growth rates are expected to keep falling in the short term, according to the budget for 2011 and the planning period of 2012 2013.

In 2010, expenditures on general education totaled RUB 827,4 bln or 44.5% of the consolidated budgetary expenditures for education in the Russian Federation. Consequently, an average of RUB 62,4 K were spent per public and municipal secondary schooler in Russia in 2010.

An average of RUB 132,6 K was spent per state-financed student in higher education.

Section 5.

Social Sphere Wages of Education Employees Wages of the education employees should have been raised against the average in the economy through a new labor remuneration system as a tool designed to attract skilled workforce to the system of education. Unfortunately, it was not the case, which can be seen by comparing the dynamics of wages of education employees in 2004 2008 and early in 2010.

Dynamics of monthly average accrued wages by Federal District in 2004 2008 is presented in Table 12.

Table Dynamics of monthly average accrued wages in the educational system in 20042008 by Federal District (RUB) For reference:2004 2005 2006 2007 2008 as % of the wages in the Russian economy and federal districts Russian Federation 4203,4 5429,7 6983,3 8778,3 11316,8 65,Central Federal District 4735,1 6258,6 8230,3 10867,3 14493,2 70,Northwestern Federal District 5028,0 6628,7 8446,3 10402,9 13210,2 68,Southern Federal District 2991,8 3757,3 4842,5 6036,5 7773,6 66,Volga Federal District 3210,4 4076,3 5226,8 6478,8 8359,2 63,Urals Federal District 5233,6 6788,4 8763,3 11022,9 13660,6 62,Siberian Federal District 4222,8 5390,2 6872,8 8414,2 10523,1 68,Far Eastern Federal District 5887,8 7268,5 9082,2 10938,8 13891,4 66,Source : data published by Rosstat.

In 2009 monthly average wage in education totaled RUB 13312, or 65.8% of the monthly average wage in the Russian economy, which means that it remained the same against the average in the economy against 2008.

Monthly average accrued wage by level of education and federal district in the period between January and May 2010 is presented in Table 13.

However, in 20101 wages of education employees accounted for 62% of the monthly average wage in the Russian economy, which means that in 2010 wages in the field of education increased at a slower rate than wages in the Russian economy.

The data published by Rosstat (Table 13) shows that all of the recently made efforts in general and basic vocational education failed to bring any visible results: in 2005, the monthly average wage of the teachers at the elementary and senior high schools accounted for 61% of the monthly average wage in the economy, whereas in H1 2010, in five years, the percentage slightly increased up to 61.6% (in terms of the Russian average figures). Wages in basic vocational education was found to be ever lower than in general education, save for the Northern Caucasus Federal District.

Most recent data published by Rosstat.

RUSSIAN ECONOMY IN trends and outlooks Table Monthly average accrued wage of education employees at the federal districts by level of vocational education in January May 2010, RUB of which:

Name Russian 21144 13363 9948 10089 13029 11810 15663 19351 63,2 47,0 47,7 61,6 55,9 74,1 91,Federation Central 26459 17527 14273 10280 17405 11508 20657 22395 66,2 53,9 38,9 65,8 43,5 78,1 84,Federal District Northwestern 24056 15574 11140 13454 15472 14912 17048 21592 64,7 46,3 55,9 64,3 62,0 70,9 89,Federal District Southern 15343 10630 7110 9567 10849 10438 12291 14962 69,3 46,3 62,4 70,7 68,0 80,1 97,Federal District Northern 12097 8372 6131 7963 8157 9115 10859 11642 69,2 50,7 65,8 67,4 75,3 89,8 96,Caucasus Federal District Urals Federal 25349 14658 10689 14081 15468 13405 16399 21189 57,8 42,2 55,5 61,0 52,9 64,7 83,District Siberian 18744 12011 8271 9678 11587 11199 14051 19341 64,1 44,1 51,6 61,8 59,7 75,0 103,Federal District Far Eastern 26445 16363 11351 14731 16800 16407 19606 22294 61,9 42,9 55,7 63,5 62,0 74,1 84,Federal District Source: data published by Rosstat, which was provided during preparation of the materials for the meeting of the State Council for vocational education which was on 31.08.5.4.3. Institutional Reforms in Education Universal State Exam In 2009, the Universal State Exam (USE) was for the first time introduced in full into the educational system, and higher educational institutions admitted applicants on the basis of the USE results.

The following rules of entitlement to the secondary school diploma were established after the introduction of the USE. Where a school graduate fails to pass one of the two compulsory USE subjects, which means that he/she is assigned a grade below the established minimum, he/she may repeat the exam. If a school graduate fails to collect the required minimum of points immediately following the two compulsory exams (the Russian language and mathematics), he/she in not entitled to repeat the exams until next year, in which case he/she is entitled a secondary school attendance certificate rather than a USE pass certificate.

Where a school graduate, taking an exam on a subject of his/her choice (exclusive of the Russian language and mathematics), is assigned a grade below the minimum, he/she is not entitled to repeat the exam until next year.

SVE tion) EVE omy, % HVE Education total Total in the economy wage in the economy, % wage in the economy, % age wage in the economy, % age wage in the economy, % age wage in the economy, % Basic general and general Wages in elementary general the average wage in the econeducation against the average Wages in education against the Wages in SVE against the aver(senior) secondary education preschool education (precedWages in EVE against the averWages in HVE against the averWages in Basic general and genelementary general education Wages in PE against the average average wage in the economy, % eral secondary education against ing elementary general educaSection 5.

Social Sphere Where a school graduate collects the number of points above the established minimum threshold for two compulsory subjects whereas collects the number of points below the minimum threshold for a subject(s) of his/her choice, he/she will be entitled to a secondary school diploma.

Hence the rules for passing the USE fail to be explicit in that the entitlement to the secondary school diploma in the Russian secondary school is only linked to passing the threshold imposed on the two compulsory subjects the Russian language and mathematics1. From now on, the secondary school may not be liable for the knowledge of other subjects. Furthermore, the rules fail to define when and how secondary school graduates who fail to pass exams in Russian and mathematics must get the knowledge they failed to get due to various reasons, including neglecting their schoolwork. It is unclear how to distinguish between neglect schoolwork and poor work of teachers. Neither is it clear about optional subjects: is it not specified when and how a school graduate has to complete his/her studies to be able to pass exams on these subjects. It should be noted, however, that the Federal Law No. 194-FZ On the Amendments to Specific Legal Acts of the Russian Federation in Connection with the Establishment of Compulsory General Education which, generally speaking, holds the state, which is represented by public or municipal general educational institutions, liable for the full-fledged knowledge of secondary schoolers, was adopted as early as 2007. It is the kids from lower-income households, which cannot afford additional knowledge required for passing the USE, who are exposed most by shifting this problem onto the schoolers and their families. Consequently, no further development in terms of education and vocational education was defined. More specifically, to be able to enter secondary vocational education institutions, one has to have a secondary school diploma, which means that those who fail to pass exams on the compulsory subjects only may enter EVE institutions. Those who have a secondary school diploma but fail to collect the required number of points for optional subjects are likely to enter SVE institutions.

In 2008, the final year of the USE experiment, the USE results shocked the society: grades of 2 in Russian and mathematics accounted for 11.2% and 23.5%, respectively, which meant that more than one third of the secondary school graduates would not be entitled to a secondary school diploma (fail to graduate) and enter a higher educational institution, which became a social norm for 11-grade secondary schoolers. The USE, a symbol of better access to higher education, instantly became an obstacle to entering higher educational institutions.

In 2009, when the USE was introduced in full, the economic recession in Russia was in full swing, and public authorities got very concerned about the inflow of unskilled seocondary school graduates to the labor market.

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