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The rise in the number of participants in the experiment evidences that regions and universities are keen to benefit from its results. That said the progress with the experiment owes its success to order of 10 February 2004 No. 560 of the RF Ministry for education and Science on the mandatory account of the USE scores by the universities of the federal subordination (except for the Moscow Lomonosov University) located in Moscow and Moscow oblast. They were ordered to identify, as a rule, not less than 50% of the overall specialties across which the 2004 enrollment with account of the USE scores was conse quently conducted.

Single regional educational agencies (the Moscow City Department of Education among them) were not in a position to ensure a full scale conduct of the experiment. That created certain complexities with regard to securing the quality of rights of graduates from the public secondary institutions in Moscow and those of other Subjects in the course of enrollment to the Moscow based universities. To overcome this contradiction, upon a submission by the Moscow City Department of Education, on 11 February 2004 the RF Ministry for Education and Science issued its order No. 584. The order reads that for graduates from the 11th (12th) forms of public secondary educational institutions based in the city of Moscow that their participation in the USE is voluntary, while the examination is conducted by 5 subjects.

In 2004, the Ministry of Education specified methodological documents that regu lated the procedure and the content of USE, the procedure of functioning of the state ex amination and arbitration commissions of the RF Subjects, the procedure of enrollment to higher educational and secondary polytechnic institutions. In addition to that, the Ministry created an informational infrastructure on the basis of the federal and 63 regional informa tion processing centers. The higher education and secondary polytechnic institutions were allowed to check evidences of the USE outcomes in the Federal Base of Evidences.

In October 2004, IV Russian Conference on the experiment outcomes and setting tasks for the 2005 experiment was held. The conference positively assessed the USE ex periment.

In 20052006, it is intended to complete the approbation of the procedure and tech nology of USE in all the RF Subjects, while reserving the right for them to select patterns of participation (quantity of subjects, obligatory/voluntary participation in USE by graduates and institutions). In 2005, it is planned to introduce USE in full across 16 regions where the USE experiment lasted not less than 3 years. In 2005, as many as 78 regions expressed Section 3.

The real sector their intention to participate in the USE experiment. So, about 83% of Russian secondary school graduates are going to take USE next year.

It is planned to ensure a step by step transformation of USE into a sole examination instrument throughout Russia in 20062008. So, the deadline for the compulsory intro duction of USE across the country is postponed from the originally scheduled 2006 to 2008.

Meanwhile, the RF Ministry of Education and Sciences stand is that USE should not be considered the only instrument of examination for the graduates enrolling for universi ties. The Ministry calls for alternative forms of the entrance examinations. According to the head of the Federal Service for Supervision in the sphere of education, universities will un doubtedly maintain the right to carry out competitions, whose results allow graduates to enroll for the leading universities. The competitions presently exist in the pyramidal form:

school city oblast okrug the federation. It is intended to somewhat modify this ar rangement to ensure the winners of regional competitions are accepted by all Russian uni versities on a non competition basis. Besides, universities will be able to hold additional examinations for graduates with USE certificates.

Approbation of New Mechanisms of University Financing In compliance with RF government Resolution of 26 June 2004 No 313, the experi ment on transition to the financing of single universities by means of state nominal financial obligations (SNFO) was prolonged through 2004. The structure of universities participating in the experiment approved by order of 30 June 2004 No. 37 of the Federal Agency for Education under the RF Ministry for Education and Science remained unchanged vis vis 2003. It comprises 6 universities: Mari State University, Mari State Polytechnic University, Chuvash State University, Yakut State University, Mari State Teachers Training University, Chuvash State Teachers Training University. The overall number of students using SNFO accounts for 12,548 in 2004 of which 11,657 had a SNFO of a regular amount, while the remaining 891enjoyed an increased amount of SNFO.

Those were the students whose specialties are especially significant for social and economic development of regions, albeit not demonstrating a sufficient demand for them on the part of the population.

The methodological basis of the experiment that determines conditions and proce dures of its implementation remained practically unchanged in 2004, albeit in the late 2003, according to the outcomes of the first stage of the experiment, the RF Ministry for Education prepared a number of proposals on its improvement.

In 2004, the value of the budget funds earmarked for the SNFO purposes as per or der of the RF Ministry for Education of 22 July 2004 No. 26 remained unchanged vis vis 2003. The average proportional costs across the SNFO items in universities accounted for 11,800 rubles. Such an approach against the background of the overall growth of costs for university education essentially means a reduction in the budgetary financing of the uni versities current spending. The dynamics of distribution across SNFO categories in uni versities testifies to the growth in 2004 of the share of the 3rd and 4th SNFO categories and some drop in the share of the 1st 2nd SNFO categories.

It is worthwhile noting that in the universities that participate in the experiment the correlation between the first year students whose education was paid for from the federal budget and those who co financed their education has slightly changed in favor of the former group over the past three years (Table 45).

RUSSIAN ECONOMY in trends and outlooks Table Distribution by SNFO Categories in the Universities Participating in the Experiment (Across All the Forms of Education), as % 2002 2003 1st category 8,0 11,6 8,2nd category 39,0 27,5 27,3rd category 37,6 42,7 46,4th category 10,8 12,5 12,5th category 4.7 5,7 4,Source: Basing on the data of the State University the Higher School of Economics.

Table The Share of the First Year Students in the Universities Participating in the Experiment at the Expense of the Federal Budget and Co Funding Their Education, as % 2002 2003 Across all the forms of tution:

at the expense of the federal 58,7 59,7 61,budget co funding 41,3 40,3 38,Regular tution:

at the expense of the federal budget 58,8 58,6 60, co funding 41,2 41,4 40,By correspondence:

at the expense of the federal budget 58,6 64,0 66, co funding 41,3 36,0 33,Source: Basing on the data of the State University the Higher School of Economics.

To extend the information base of the SNFO experiment with its order of 13 August 2004 No. 51 the Federal Agency for Education bound a number of universities that were not participating in the experiment to submit data necessary for conducting model computations of the SNFO functioning. Notwithstanding the above, 2004 did not witness any real steps on the experiment modification, while all the above deficiencies of the approbated new mecha nism of university funding52 essentially were still there. That concerns, primarily, an increase of the SNFO amount across all the categories, reduction in their number from 5 to 3, award ing the winners of the nationwide school competitions and participants in international school competitions with the highest SNFO category to ensure the possibility for them to enroll for the respective departments of the public universities, introducing a greater amount of SNFO for the specialties that objectively appear more costly than the others. As well, one should ensure the possibility for changing the originally granted SNFO category according to the students performance and examination results.

Given the scope of the experiments underway, they address single avenues of the education system reform and do not form an integral complex strategy of modernization of all elements of the Russian education system. This has not allowed for a much needed mass support of the reforms underway and making their goals clear and shared by the ma jority of the educational community and society on the whole.

Rossiyskaya Ekonomika v 2003. Tendentsii i perspektivy. M.: IET, 2004. P. 289290.

Section 3.

The real sector Modifications in the Education Legislation In compliance with Federal Law No. 122 FZ of summer 2004, the education legisla tion underwent substantial modifications. Consequently, a number of provisions of the Law On Education that envisaged public guarantees of priority of education, particularly, the higher education (on issues of financing the education system including the universities social sphere, provision of tax and other benefits, etc.) was abolished.

As per the Law, the provisions that regulated the standardized financing of educa tional institutions were modified. The Law formulates a new content of the concepts of the federal, regional and local standards of financing educational institutions. Thus, the fed eral standard concerns financing institutions of the federal subordination, the regional standard those of the regional subordination. So far the local standard is concerned, it is related to institutions of the local subordination. In addition to that, item 41 of the Law On Education reads that the financing of public educational institutions under the RF Sub jects and municipal educational institutions is exercised basing on the federal standards and those of the RF Subjects. However, the Law does not stipulate the procedure of ap proving of the respective federal standards.

Meanwhile, the Law maintained the provision, which provides for the setting of stan dards of financial costs for small rural and considered as such by government and educa tional agencies institutions. These costs do not depend on the quantity of students therein.

Hence, in compliance with the Law the procedure of regulation of issues associated with organization of control and financing of the education system was fundamentally modified. This primarily concerns assignment of competence in the education sphere be tween levels of government and exclusion of the possibility for an additional financial sup port from the budgets of other levels. Division of powers between the levels of government is chiefly made basing on the principle of a strict tying to the level of financing of educa tional institutions. This would result in a restriction of possibilities for an additional financial support of institutions, their employees and student as well.

The Law has lifted restrictions on the paid for enrollment of students for their training in the sphere of jurisprudence, economics, management (the share of students who paid for educational services could not earlier exceed 50% of their respective number at a given department). The abolition of this restriction, on the one hand, allows to meet the popula tions effective demand for educational services and solidify the financial state of universi ties, while, on the other, to intensify the urgency of the task of provision of a proper control over the quality of education.

The legal modifications also concerned the practice of co founding of educational institutions. The Law On Education had earlier permitted the co founding, but now such possibility is excluded, because it contradicted to the Civil Code. The system of co founding of educational institutions was rather efficiently employed in Samara oblast in the course of organization of a two level financing of schools, with educational expenses being covered from the regional budget, while communal expenses and those on the real estate maintenance from the municipal budget. The removal of this provision intensifies the ur gency of the task of development of new integration forms of provision of educational insti tutions with resources.

In compliance with the new legislation, the procedure of provision of social protection to students from the budget funds is replaced by a mechanism of implementation of social support measures. It is provided that this particular mission will fall under the competence of educational institutions themselves. Given the above, the current legislation cancels the students meals and transportation benefits, particularly, for those trained at the publicly RUSSIAN ECONOMY in trends and outlooks accredited non government educational institutions that are deprived of the right for bene fits that the RF law set for students of public and municipal educational institutions.

The Law substantially modified labor compensations to the budget employees and, particularly, those in the education sphere. The minimal amount of tariff rate (wages) of the budget employees is no longer recognized as a uniform and mandatory one nationwide.

Besides, it became the differentiated (depending on the level of the budget financing and residence) instrument of regulation of labor compensations in the regions, which consid erably lowered the level of employees labor rights. Moreover, the Law abolished the gov ernment obligations on adjustment of the level of teachers wages by means of setting la bor compensation standards in the form of the labor compensations in the educational sector to those in the industrial sector ratio.

Resulting from the abolishment of RSFSR Law of 21 December 1990 No 438 1 On Social Development of the Countryside, rural teachers have lost their right for the extra 25% wages and tariff rates vis vis their urban colleagues. The abolishment of the given benefit substantially deteriorates their economic state of and will have an extremely nega tive effect on the staffing capacity of the sector. As well, this will derail the teachers pro fessional prestige, which presently has already sunk considerably.

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