Educational expenditure statistics


Data extracted in October 2020.

Planned article update: December 2021.

Highlights

In 2017, public spending on education relative to GDP was highest in Denmark (7.3 %) and Sweden (7.1 %) while it was lowest in Romania (2.7 %).

The share of public education expenditure used for financial aid to households and students ranged from 0.2 % in Greece (2017 data) to 21.6 % in Bulgaria (2016 data).

Distribution of expenditure on education (excluding early childhood educational development) by sector, 2017
(% of combined public, private and international expenditure on education)
Source: Eurostat (educ_uoe_fine01)

This article presents statistics on education finance in the European Union (EU) based on the joint UNESCO/OECD/Eurostat (UOE) data collection and forms part of an online publication on education and training in the EU. Expenditure on education may help foster economic growth, enhance productivity, contribute to people’s personal and social development, and help reduce social inequalities.

Within the EU, the proportion of financial resources devoted to education is one of the key choices made by national governments. In a similar manner, enterprises, students and their families also make decisions on the financial resources that they are able or willing to set aside for education.

This article covers various aspects of education finance, namely different sources of funding (such as funding by the government or by households), as well as education expenditure by educational institutions. It covers pre-primary to tertiary levels of education, in other words expenditure on all levels of education except for early childhood educational development (as defined by the International standard classification of education (ISCED) level 01).

Full article

Overall educational expenditure

Among EU Member States, the funding of education mainly comes from government, with a smaller role for private sources (including households, enterprises, non-profit organisations and religious institutions), while an even smaller role is generally played by international organisations (such as the United Nations or the World Bank).

Table 1 presents information on public expenditure on education, in other words, expenditure by the government including payments and transfers for education to the non-educational private sector. The highest overall levels of government expenditure on education (excluding early childhood educational development) were unsurprisingly recorded in the most populous EU Member States: in 2017, expenditure peaked at EUR 147.0 billion in Germany, followed by EUR 125.2 billion in France. The level of government expenditure on education in Italy (EUR 70.2 billion) and Spain (EUR 47.3 billion) was considerably lower.

Among the EU Member States for which data are available (see Table 1 for coverage), the highest rates of increase for government expenditure on education between 2012 and 2017 were recorded in Bulgaria, Romania, Hungary and Malta where the level of expenditure rose, on average, by 5.8-7.8 % each year — relatively high growth (an average of 13.6 % per year) was also recorded in Iceland. Note that these rates of change are based on data in current prices. The level of government expenditure on education fell between 2012 and 2017 in four of the Member States. Average reductions in expenditure were less than 1.0 % per year in Cyprus and Lithuania, while the decreases in expenditure in Greece and Latvia were more marked (on average 2.4 % and 4.1 % each year respectively).

Table 1: General government expenditure on education (excluding early childhood educational development), 2012-2017
(billion EUR)
Source: Eurostat (educ_uoe_fine01)

Figure 1 shows the relative expenditure on education from the three main sources of expenditure, namely, that made by government, non-educational private sources and international organisations.

The share of total spending on education in 2017 coming from governments ranged from 73 % in Cyprus up to 96 % in Sweden (2014 data) and 98 % in Romania. It should be noted that some government expenditure relates to payments and transfers for education to the non-educational private sector — this includes subsidies to households and students as well as payments to other non-educational private entities. As such, this part is counted twice, once in government expenditure and a second time in the expenditure of households and other non-educational private entities. Non-educational private sources contributed more than 10.0 % of total expenditure on education in 17 Member States. The share of private sources was within the range of 20-25 % in Slovakia, Portugal and Spain, and peaked at 25.7 % in Cyprus.

Figure 1: Distribution of expenditure on education (excluding early childhood educational development) by sector, 2017
(% of combined public, private and international expenditure on education)
Source: Eurostat (educ_uoe_fine01)

The contribution of international organisations to expenditure on education was generally much lower. Their share was below 3.0 % of total expenditure in all but four of the Member States for which data are available: Poland, Luxembourg (both 3.1 %), Lithuania (3.5 %) and Latvia (3.8 %).

In the most recent year for which data are available (see Figure 2), Bulgaria was the only EU Member State where the highest share of total expenditure on education was not allocated to primary and lower secondary education: tertiary education accounted for almost one third (31.4 %) of total education expenditure in Bulgaria in 2016, compared with a 30.0 % share for primary and lower secondary education. For the other Member States, the share of total expenditure accounted for by primary and lower secondary education ranged from a low of 32.7 % in Hungary (2015 data) up to more than half of the total in Luxembourg (50.3 %) and Ireland (54.3 %; 2014 data).

Figure 2: Distribution of expenditure on education (excluding early childhood educational development) by level of education, 2017
(% of expenditure on education)
Source: Eurostat (educ_uoe_fine01)

Generally, the smallest share of educational expenditure in 2017 was recorded for pre-primary education, with its share ranging from 2.0 % in Ireland (2014 data) and less than 10.0 % in Cyprus, the Netherlands, Malta and Austria up to at least one fifth of total education expenditure in Bulgaria (20.0 %; 2016 data) and Sweden (20.5 %; 2015 data). These last two EU Member States were atypical insofar as pre-primary education did not account for the lowest share of education expenditure, as the proportion of spending on upper secondary and post-secondary non-tertiary education was less. This was also the case in Lithuania while in Luxembourg the share of expenditure on tertiary education was lower than the share on pre-primary education.

Upper secondary and post-secondary non-tertiary education typically accounted for one sixth to one quarter of total educational expenditure in 2017, with lower shares recorded in Lithuania and Sweden (2015 data), and higher shares registered in Belgium, Italy and Hungary (2015 data).

Expenditure on tertiary education in 2017 was generally higher than the share for upper secondary and post-secondary non-tertiary education, although there were five exceptions among the EU Member States: Hungary (2015 data), Luxembourg, Italy, Belgium and Portugal. Tertiary education accounted for one fifth to one third of total educational expenditure in all of the EU Member States for which data are available, except for Luxembourg and Hungary (2015 data) which were below this range and Estonia which was above it (37.5 %, based on incomplete data; 2015 data).

Public expenditure

In 2017, the highest public spending on education relative to GDP among the EU Member States was observed in Denmark (7.3 %) and Sweden (7.1 %), followed by Belgium (6.3 %) and Finland (6.1 %), while relatively high ratios were also recorded among the northern EFTA members, Norway (6.9 %) and Iceland (6.7 %) — see Table 2 and Figure 3. Aside from Denmark, Sweden, Belgium and Finland, most of the Member States reported ratios of public expenditure on education relative to GDP that were between 3.4 % and 5.8 %, with only Romania below this range.

Table 2: Main indicators for public expenditure on education (excluding early childhood educational development), 2017
Source: Eurostat (educ_uoe_fine01), (educ_uoe_fine06) and (educ_uoe_fine08)

Table 2 also shows the ratio of public expenditure on education relative to gross national income (GNI); GNI is calculated as GDP plus income received by residents that was earned abroad minus the income remitted by non-residents back to their home countries. In a majority of the EU Member States, there is a small difference between these two measures, however, the impact of income flows in the relatively small and open economies of Luxembourg, Ireland and to a lesser extent Malta resulted in more marked differences: the relative importance of education expenditure was higher when measured in relation to GNI as national income was lower than GDP due to the high level of remittances made by non-residents. For example, the level of public expenditure on education relative to GDP was 3.6 % in Luxembourg in 2017, compared with 5.5 % when expressed relative to GNI.

Figure 3: Public expenditure on education (excluding early childhood educational development) relative to GDP, 2017
(%)
Source: Eurostat (educ_uoe_fine06)

Expenditure of educational institutions

Table 3 presents an analysis of expenditure of educational institutions (either made directly by the institutions themselves or made by government on behalf of the institutions) for 2017. In two of the EU Member States for which data are available (no data available for Denmark, Estonia or Greece), capital expenditure exceeded 10.0 % of total capital and current expenditure on educational institutions: 11.2 % in Latvia and 10.2 % in the Netherlands. By contrast, capital expenditure accounted for less than 4.0 % of current and capital expenditure in Croatia (2014 data) and Italy.

In most of the EU Member States for which data are available (9 out of 15), a majority of expenditure on educational institutions in 2017 was on teachers’ pay, although such pay accounted for 40-50 % of the total expenditure in France, Lithuania, Slovakia (2014 data), Malta, Finland and Czechia (2016 data).

Table 3: Expenditure on educational institutions (excluding early childhood educational development), 2017
Source: Eurostat (educ_uoe_fini01)

Declining birth rates and shifts in population structures have resulted or are projected to result in reduced school age populations in many countries. In turn, this may well have an impact on ratios such as the average expenditure per pupil (for example if expenditure is held constant); this ratio may also be impacted by other factors, such as the participation rate of young children in education. Data for annual expenditure (from public and private sources) on all educational institutions show that an average of EUR 13 148 was spent per pupil/student in 2017 in Sweden, while the average was EUR 2 694 in Croatia (2014 data) with the average for most other EU Member States between these values: the level of average expenditure was considerably higher (EUR 19 723 per pupil/student) in Luxembourg and it was below EUR 1 800 in Bulgaria and Romania (see Figure 4). In a majority of the EU Member States for which data are available (16 out of 25; no data available for Estonia; incomplete data for Greece), average expenditure per pupil/student was higher in public institutions than in all institutions.

Figure 4: Expenditure on educational institutions (excluding early childhood educational development) per pupil/student, by sector, 2017
(EUR per pupil/student in full-time equivalents)
Source: Eurostat (educ_uoe_fini04)

With the exceptions of Greece (incomplete) and Cyprus, expenditure on public and private educational institutions per pupil/student was highest among tertiary education institutions (no data for expenditure on tertiary students for Ireland or Slovakia). The general pattern observed was one whereby expenditure per pupil/student increased from the lowest to the highest level of education (see Figure 5). Indeed, around half of the EU Member States reported that their lowest level of expenditure per pupil was for pre-primary education (no data available for Estonia or Ireland). However, the lowest level of expenditure per pupil was recorded for upper secondary and post-secondary non-tertiary education in Denmark, Croatia (2014 data), Estonia (incomplete), Lithuania, Poland, Slovenia, Finland and Sweden, while it was recorded for primary and lower secondary education in Bulgaria, Germany, Hungary and Romania. Greece was an exception in that its lowest level of expenditure per pupil/student (among the three education levels for which data are available) was for tertiary education.

Figure 5: Expenditure on educational institutions (excluding early childhood educational development) per pupil/student, by level of education, 2017
(EUR per pupil/student in full-time equivalents)
Source: Eurostat (educ_uoe_fini04)

Financial aid to households and students

Financial assistance to households or students may take a variety of different forms, including scholarships, public loans and allowances contingent on a student’s status. The relative importance of financial support may also depend on the education level being analysed: compulsory education is generally free to pupils/students, while tertiary education might or might not be free. The share of public education expenditure that was used for financial aid to households and students ranged in 2017 from 0.2 % in Greece and 1.6 % in Luxembourg up to 9.4 % in Ireland (2014 data) and 9.5 % in Sweden; double-digit shares above this range were recorded in the Netherlands (12.0 %) and Denmark (15.4 %), while by far the highest share was recorded in Bulgaria (21.6 %; 2016 data) — see Figure 6.

Figure 6: Financial aid from government to households and students as a share of public expenditure for all education levels (excluding early childhood educational development), 2017
(%)
Source: Eurostat (educ_uoe_fine02)

Figure 7 shows information pertaining to the financial aid given to households and students. Note that these data reflect to some degree the national organisation of education systems. They also reflect the various methods that are used to fund education systems and to provide welfare support and other forms of financial aid to encourage students to remain within the education system. Primary and lower secondary education are largely compulsory across the EU and such education tends to be provided free of charge; these levels are therefore excluded from the information presented in Figure 7. With the exceptions of Bulgaria, Slovenia, Czechia, Bulgaria, Latvia and Croatia (2014 data), the level of financial aid to households and students in 2017 was higher for tertiary education than for upper secondary and post-secondary non-tertiary education. Note that in some countries the capacity of the tertiary education sector is relatively low and this may lead to support being provided to students so that they may study abroad. Financial support to outward degree mobility is not covered by the data.

Figure 7: Financial aid from government to households and students, 2017
(EUR per pupil/student)
Source: Eurostat (educ_uoe_fine02) and (educ_uoe_fine10)

The share of public expenditure on tertiary education used for financial aid to students exceeded 25.0 % in Italy, Sweden and the Netherlands, stood at around one third in Denmark (33.0 %) and peaked at 36.8 % in Ireland. For upper secondary and post-secondary non-tertiary education, shares of more than 15.0 % were reported for Bulgaria, Germany and Ireland, peaking at 22.1 % in Denmark. For primary and lower secondary education the shares were below 3.5 %, with the notable exception of Bulgaria (26.7 %) — see Figure 8.

Figure 8: Financial aid from government to households and students as a share of total public expenditure on education, 2017
(%)
Source: Eurostat (educ_uoe_fina01)

Student fees and financial support can play an important role in encouraging (or discouraging) access to tertiary education. While fees may impose a financial burden, various support measures may be used to alleviate obstacles to study. Figure 9 focuses on direct financial support to students in the form of grants and loans; note that indirect support may be available to students (and their families) through allowances or tax incentives.

Almost all of the EU Member States offer at least one type of direct financial aid (a grant or a loan) to students in tertiary education. In some of the Member States, both grants and loans exist; as such, students may have to apply through separate procedures to receive both forms of aid. Figure 9 shows the distribution of financial aid to households and students in tertiary education; note there were 20 Member States where student loans either did not exist or where student loans accounted for a very small share of the financial aid provided (less than 0.1 %). Therefore, there were only seven Member States where the division in aid between student grants and student loans was not almost entirely weighted in favour of student grants. In Poland, Slovakia, Denmark, Germany and Cyprus, a majority of the financial aid from government to tertiary students was provided in the form of student grants. By contrast, in the Netherlands and Sweden, a majority of the financial aid for tertiary students was provided in the form of student loans.

Figure 9: Distribution of financial aid from government to households and students in tertiary education by type of expenditure, 2017
(%)
Source: Eurostat (educ_uoe_fine02)

Figure 10 provides a similar analysis to that in Figure 6, except it focuses on expenditure by non-educational private entities (other than households) rather than public expenditure. As noted above, such entities include for example enterprises, non-profit organisations and religious institutions. The share of total education expenditure accounted for by these entities and destined for financial aid to households and students was much more diverse than that noted for public expenditure. In 6 of the 22 EU Member States for which data are available (see Figure 10 for coverage) the share was less than 0.1 %. At the other end of the scale, financial aid provided to households and students accounted for more than half of the total expenditure by non-educational private entities in four Member States: the share was between half and three fifths in Slovenia (note that the coverage is not complete) and Cyprus, just over four fifths in Finland and reached 100 % in Hungary.

Figure 10: Share of all education expenditure (excluding early childhood educational development) by non-educational private entities (other than households) used for financial aid to households and students, 2017
(%)
Source: Eurostat (educ_uoe_fine03)

Source data for tables and graphs

Data sources

Source

The standards for international statistics on education are set by three international organisations:

The source of data used in this article is a UOE data collection on education statistics and this is the basis for the core components of Eurostat’s database on education statistics; in combination with the joint data collection Eurostat also collects data on regional enrolments and foreign language learning.

Regulation (EC) No 452/2008 of 23 April 2008 provides the legal basis for the production and development of the EU’s statistics on education and lifelong learning. Two European Commission Regulations have been adopted concerning the implementation of the education and training data. The first, Commission Regulation (EU) No 88/2011 of 2 February 2011, concerned data for the school years 2010/2011 and 2011/2012 while the second, Commission Regulation (EU) No 912/2013 of 23 September 2013, concerns data for school years from 2012/2013 onwards.

More information about the joint data collection is available in an article on the UOE methodology. It is also recommended to refer to the specific country metadata (see the Finance sheet) before analysing the data presented in this article.

Classification

The international standard classification of education (ISCED) is the basis for international education statistics, describing different levels of education; it was first developed in 1976 by UNESCO and revised in 1997 and again in 2011. ISCED 2011 distinguishes nine levels of education: early childhood education (level 0, with level 01 for early childhood development and level 02 for pre-primary education); primary education (level 1); lower secondary education (level 2); upper secondary education (level 3); post-secondary non-tertiary education (level 4); short-cycle tertiary education (level 5); bachelor’s or equivalent (level 6); master’s or equivalent (level 7); doctoral or equivalent (level 8). The first results based on ISCED 2011 were published in 2015 starting with data for the 2012 reference period for statistics on expenditure.

Key concepts

Note that in the following key concepts the expression ‘expenditure by or on (…) institutions’ is used for both expenditure by the institutions themselves (for example, salaries paid by a fiscally autonomous university) and expenditure by governments on, or on behalf of, the institutions (for example, salaries paid by a national education ministry directly to individual teachers/lecturers who are employed in public or private schools/universities and other educational institutions).

Expenditure for all levels of education combined encompasses the expenditure for all education programmes from pre-primary (ISCED level 02) to tertiary education (ISCED level 8).

Total expenditure comprises current and capital expenditure. Current expenditure comprises personnel expenditure and other current expenditure.

Total public expenditure on education includes i) direct public funding for educational institutions and ii) transfers to households and enterprises (including non-profit organisations). Generally, the public sector funds education either by bearing directly the current and capital expenses of educational institutions (direct expenditure for educational institutions) or by supporting students and their families with scholarships and public loans as well as by transferring public subsidies for educational activities to private enterprises or non-profit organisations (transfers to private households and enterprises).

Expenditure on institutions is not limited to that made on instructional services, but also includes expenditure on ancillary services for students and families, where these services are provided through educational institutions. At the tertiary level, spending on research and development can be significant and this is included in the data presented to the extent that any such research is performed by educational institutions. As such, expenditure on educational institutions includes expenditure on core educational goods and services, such as teaching staff, school buildings, or school books and teaching materials, and peripheral educational goods and services such as ancillary services, general administration and other activities. Education expenditure on institutions covers all types of public or private schools/universities and other educational institutions that are involved in delivering or supporting educational services.

Expenditure on educational institutions from public sources corresponds to direct expenditure on educational institutions from public sources. It may take one of two forms:

  • direct purchases by government of educational resources to be used by educational institutions (such as the payment of teachers’ salaries by a central or regional education ministry);
  • payments made by government agencies to educational institutions that have responsibility for purchasing educational resources themselves (for example, a government appropriation or block grant to a university, which the university then uses to compensate staff and/or to purchase other resources).

Direct expenditure by a government agency excludes tuition payments to an institution that have been received from students (or their families) enrolled in public schools under that agency’s jurisdiction, even if such tuition payments flow, in the first instance, to the government agency rather than to the institution in question.

Expenditure on educational institutions from private sources comprises: school fees; materials (such as textbooks and teaching equipment); transport to school (if organised by the school); meals (if provided by the school); boarding fees, and; expenditure by employers on initial vocational training.

Public financial aid to students refers to direct public assistance to pupils/students in the form of scholarships, public loans and family allowances contingent on student status. This is not a full measure of the level of assistance students may receive as for instance, students (or their families) may also get financial support indirectly, for example through ancillary services (in other words student welfare services such as meals, transportation, healthcare or dormitories) or tax reductions.

Accounting conventions

Data on educational expenditure are compiled on a cash accounting rather than an accrual accounting basis. As such, expenditure is recorded in the year in which the payments occurred. This means in particular that:

  • capital acquisitions are counted fully in the year in which the expenditure occurs;
  • depreciation of capital assets is not recorded as expenditure, though repair and maintenance expenditure is recorded in the year it occurs.

Expenditure on student loans is recorded as the gross loan outlays in the year in which the loans are made, without netting-off repayments from existing borrowers.

Tables in this article use the following notation:
Value in italics     data value is forecasted, provisional or estimated and is therefore likely to change;
: not available, confidential or unreliable value.

Context

Education accounts for a significant proportion of total public expenditure in all of the EU Member States. The largest education budget item is usually expenditure for staff. The cost of teaching usually increases substantially as a young person moves through the education system, with expenditure per pupil/student considerably higher in universities than in primary schools. Although tertiary education generally costs more per pupil/student, the highest share of total education spending is normally allocated to secondary education, as this level teaches a larger share of the total number of pupils/students.

There is a policy debate in many EU Member States as to how to increase or maintain funding for education, improve efficiency and promote equity — a challenge that became harder in the context of the global financial and economic crisis and subsequent sovereign debt crises and will be made harder still by the current COVID-19 pandemic. The debate is not purely about the levels and sources of finance, but also concerns proposals for reforms of education policies and systems and raises questions as to the development of labour force skills for the future, for the benefit of individuals and society. Possible approaches to funding include tuition fees, administrative or examination charges; another potential fundraising source is partnerships between business and higher educational establishments.

Education costs may be balanced by needs-based or merit-based support: merit-based support includes support awarded on the basis of academic performance; needs-based support includes income-contingent grants, loans or other support to try to stimulate enrolment rates in higher education, in particular among the less well-off members of society, thereby promoting equal opportunities as well as social mobility and inclusion. An analysis of national student fees and support systems in European higher education is available in a report produced by the European Commission, the Education, Audiovisual and Culture Executive Agency and Eurydice.

The updated strategic framework for European cooperation in education and training (known as ET 2020), was adopted by the Council in May 2009. It sets out four strategic objectives for education and training in the EU, two of which are of particular relevance for educational expenditure:

  • improving the quality and efficiency of education and training;
  • enhancing creativity and innovation (including entrepreneurship) at all levels of education and training.

Effectiveness and efficiency in higher education depends on public authorities creating the right framework within which education institutions can operate. This is characterised by adequate funding and effective quality assurance policies, among other factors. ET 2020 stresses that:

  • higher education systems require adequate funding and, as an investment in economic growth, public spending in higher education should be protected;
  • the challenges faced by higher education require more flexible governance and funding systems, which balance greater autonomy for education institutions with accountability to stakeholders.
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Education finance (educ_uoe_fin)