Over 5% Transfer Within Fiscal Year End
Blocked from Use for Faculty Pension and Health Insurance Fees
Financial Struggles Due to New Student Recruitment Shortage... Autonomous Private High Schools Say "Excessive"
[Asia Economy Reporter Han Jinju] The Seoul Metropolitan Office of Education has strengthened the accounting standards for autonomous private high schools. By requiring the ‘corporate transfer funds,’ which are necessary amounts for school operation, to be transferred within the relevant fiscal year, it has imposed strict standards on autonomous private high schools.
On the 2nd, the Seoul Metropolitan Office of Education recently announced and implemented the ‘Complete Revision of the Rules on the Composition and Operation of the Autonomous School Designation and Operation Committee.’ The revision includes a provision that the corporate transfer funds, i.e., the amount the corporation supports for school operation, which is currently regulated to be at least 5%, must be transferred ‘within the end of the fiscal year.’ Autonomous private high schools do not receive government financial support but contribute 5% of the total student tuition as corporate transfer funds to cover school operating expenses. The student quota is directly linked to tuition revenue. As the number of autonomous private high schools facing difficulties in recruiting new students increases recently, strengthening the corporate transfer fund contribution standards is seen as tightening the noose on autonomous private high schools.
The Seoul Metropolitan Office of Education stated that this measure aims to correct the issue of using part of the tuition or admission fees paid in the relevant year not for educational budgets but as statutory burden funds. Statutory burden funds refer to pensions, health insurance, accident compensation burdens for teachers and staff, and the four major insurances for fixed-term teachers. Since corporations have failed to cover the statutory burden funds they are responsible for, tuition and admission fees paid by students have been used instead.
A representative from the Seoul Metropolitan Office of Education explained, "If the transfer funds come in late, it becomes difficult to grasp the financial situation, and the education office must provide guidance when the transfer funds are delayed. It is the minimum responsibility that schools operating as private institutions must observe, and this is an effort to correct procedural issues."
Among autonomous private high schools, there is an opinion that specifying the transfer timing is excessive, as there may be cases where transfers are not smooth due to management circumstances.
Previously, Busan Haeundae High School was penalized during the autonomous private high school evaluation for failing to transfer corporate funds in 2015-2016. Although all autonomous private high schools will convert to general high schools starting in 2025, the Seoul Metropolitan Office of Education’s tightening of regulations is interpreted as a measure to encourage financially struggling autonomous private high schools to voluntarily relinquish their status. In June, the Seoul Metropolitan Office of Education announced support funds for autonomous private high schools converting to general high schools to allow them to reduce tuition fees for existing students. This year, Hangaram High School and Dongseong High School decided to convert to general high schools. Including Dongyang High School, Yongmun High School, Mirim Girls' High School, Wooshin High School, Daeseong High School, and Kyungmoon High School, a total of eight schools in Seoul have relinquished their autonomous private high school status.
Professor Song Ki-chang of the Department of Education at Sookmyung Women’s University said, "It should be sufficient to transfer funds according to the corporation’s financial situation, but requiring transfer within the end of the fiscal year will put considerable pressure on corporations. It is questionable whether there is a need to apply such pressure with a negative perspective."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
