OECD (2000)

Glossary
by the school); boarding fees; and expenditure by employers on initial ➡ vocational training. Note
that private ➡ educational institutions are considered service providers, not funding sources.
Staff compensation
Expenditure on staff compensation includes gross salaries plus non-salary compensation (fringe
benefits). Gross salary means the total salary earned by employees (including any bonuses, extra
allowances, etc.) before subtracting any taxes or employees’ contributions for pensions, social security,
or other purposes. Non-salary compensation includes expenditure by employers or public authorities
on retirement programmes, health care or health insurance, unemployment compensation,
disability insurance, other forms of social insurance, non-cash supplements (e.g. free or subsidised
housing), maternity benefits, free or subsidised child care, and such other fringe benefits as each
country may provide. This expenditure does not include contributions made by the employees
themselves, or deducted from their gross salaries.
Transfers and payments to other private entities
Government transfers and certain other payments (mainly subsidies) to other private entities (firms
and non-profit organisations) can take diverse forms − for example, transfers to business or labour
associations that provide adult education; subsidies to firms or labour organisations (or associations
of such entities) that operate apprenticeship programmes; subsidies to non-profit organisations that
provide student housing or student meals; and interest rate subsidies to private financial institutions
that make student loans.
■
EDUCATIONAL INSTITUTIONS
Educational institutions are defined as decision-making centres which provide educational services
to individuals and/or other institutions. The definition is based on the point of view of management
and control, which are normally carried out by a Director, Principal, or President and/or a Governing
Board, (or similar titles such as Management Committee, etc.). In general, if a centre has a Director,
Principal, or President and a Governing Board then it is classified as an institution. If it lacks these,
however, and is controlled by an educational institution, then it is not a separate institution but
rather an off-campus centre of an institution. Where a centre is not managed by a Governing Board
but is administered directly by a public education authority, the centre is classified as an institution
in its own right.
Public and private educational institutions
Educational institutions are classified as either public or private according to whether a public
agency or a private entity has the ultimate power to make decisions concerning the institution’s
affairs.
An institution is classified as public if it is: i) controlled and managed directly by a public education
authority or agency; or ii) controlled and managed either by a government agency directly or by a
governing body (Council, Committee, etc.), most of whose members are either appointed by a public
authority or elected by public franchise.
An institution is classified as private if it is controlled and managed by a non-governmental organisation
(e.g. a Church, a Trade Union or a business enterprise), or if its Governing Board consists mostly
of members not selected by a public agency.
In general, the question of who has the ultimate management control over an institution is decided
with reference to the power to determine the general activity of the school and to appoint the officers
managing the school. The extent to which an institution receives its funding from public or private
sources does not determine the classification status of the institution.
© OECD 2000
369