Public Education Reform and Network Governance

Lessons From Chinese State-Owned Enterprise Schools

Philip Wing Keung Chan

• Publisher: Routledge
• Year: 2019
• eBook ISBN: 9780429863004
• Edition: 1
• Topic: Education
• Subtopic: Education General

This book is located in the field of education governance and sits amidst debates on public school reform in China. It examines how a top-down policy approach has been implemented from central government right down to the district level within the public education system in China. It shows the way networks support negotiation and bargaining at the district level which, in turn, influences the broader education policy of the central government.

Using statistical data from education yearbooks, government documents analysis and interviews with main stakeholders in this policy arena, the book incorporates case studies from railway State-Owned Enterprise schools. Analysis of these indicates that the processes of formulating and implementing Chinese education policy can be characterised as a form of network governance, which coordinates actors, decision-making processes and stakeholders' motivation to comply with collective decisions in Chinese education. Network governance acts as an effective and legitimate way of problem solving that assists policy implementation and education reform in China.

By comparing two traditional modes of governance (governance through bureaucracy and the governance through markets), this book shows the network mode of governance in Chinese education is more powerful and significant, especially since the negotiated results among actors in the policy community are favourable.

1
Introduction and key terms

Context

Disappointment in the state as an effective, political, steering, centre of society has increased throughout the twentieth century. This has given rise to the search for alternative modes of guiding and coordinating socio-economic development. In Western education, this questioning of government has resulted in a shift from state to market coordination (Marginson, 1997). Research studies show that networks were important in this move from government to governance (Ball, 2008; Lawn & Grek, 2012), but their significance in Chinese education reform is less well documented.

The research forming the basis of this book is located in the field of education governance and sits amidst debates on public school reform in China. It applies network governance theory from political science disciplines (Rhodes, 1997) to the shifting regulation of public education in China by its government (through a state-enterprise relationship) to a different mode of governance. Chinese public school reform has included the establishment of the Modern Enterprise System (MES) which disconnected schooling functions previously associated with State-Owned Enterprises (SOEs) and relocated them to the Ministry of Education to rectify SOEs’ loss of profit under government pressure for competition.

The book explores the trajectory of past and future development of public school reform in China. Network governance is another way to manage SOE schools in China. The reform of Chinese SOEs, which has resisted the privatisation of public schools, is presented as an example of a response to the challenges of marketisation that have been faced in education.

Thus, the book examines network governance in Chinese public school reform. This perspective recognises that both hierarchy and market coordination are influenced by community conventions and relationships. Governance operating through networks must deal with multiple decision centres in the process of coordinating service delivery in education. This focuses attention on the initiation and facilitation of interaction processes between stakeholders as a way of creating and changing network arrangements for the sake of better coordination of education.

Prior to the Open Door Policy, which began in 1978, Chinese society was often described as “closed, conservative, authoritarian and hierarchical” (Qi & Tang, 2004, p. 466). China’s education system could be characterised as a “highly centralised” or “state dominated” model (R. Yang, 2004b, p. 328). This book examines how a top-down policy approach has been implemented from central government to ministry level, to province level, to municipal city level and finally to district level within the public education system in China. It also shows the way networks support negotiation and bargaining at the district level which, in turn, influences the broader education policy of the central government. These intersecting policy implementation processes, occurring at these different levels (central, province, municipal and district), provide insight into how the centralised MES policy direction is coordinated through actions and resource transactions between actors at different levels of government and schools.

The book presents a case study of the Railway SOE schools in Harbin, the capital and largest city of Heilongjiang Province in North-east China, and Shenzhen, the gateway city to Southern China, following questions of how governance has been applied in Railway SOE schools since 1993 when they were transferred from the Ministry of Railways to the Ministry of Education under the MES. This case study is developed from research drawing on statistical data from education yearbooks (such as the Almanac of China Economy (1985–2008), the Chinese Educational Finance Statistical Yearbook (1994–2008) and the Chinese Statistical Yearbooks (1994–2008)), analysis of government documents (listed in Appendix A) and interviews with main stakeholders in this policy arena (see Appendix B for the participants’ profiles, affiliations and contributions).

In China, more than 1,100 schools were built and run by the Ministry of Railways. Analysis of these indicates that the processes of formulating and implementing Chinese education policy can be characterised as a form of network governance which coordinates actors, decision-making processes and stakeholders’ motivation to comply with collective decisions in Chinese education. Network governance acts as an effective and legitimate way of problem-solving that assists policy implementation and education reform in China.

In the book’s comparison of two traditional modes of governance (governance through bureaucracy and governance through markets), the power and significance of the network mode of governance in Chinese education is revealed. The focus on different independent actors in a policy community, who are required to exchange resources in order to achieve their own objectives and create a win-win situation, shows that these effects are enhanced by the favourable results of the negotiations among actors in the policy community.

Definitions

State-Owned Enterprises

SOEs are owned by “the people”, represented by the Chinese Communist Party (CCP) or the state and managed by government officials (Pascual, 1996). World Bank research emphasises that an SOE should have four characteristics: (1) is a government-owned productive organisation; (2) is expected to earn a significant portion of its revenues from sales of goods and services it produces; (3) possesses an accounting system separate from any government agency that controls and supervises it; and (4) is a distinct legal entity (Shirley, 1983). SOEs are not only the “backbone” of the Chinese economy but are also the main source of revenue for the central government: about 60 percent of central government revenue comes from taxing the SOE sector. However, many Chinese SOEs operate more as socio-economic entities than as purely production units whose function is to maximise profit. Their operations include the provision of social and welfare services normally considered a “public good”, such as education, medical services, housing, childcare and pensions. Indeed, many large SOEs exist much like “mini welfare states”. A detailed discussion of a central planning system related to SOEs is presented in Chapter 4.

State-Owned Enterprise schools

State-Owned Enterprise schools (SOE schools) were built and run by SOEs to provide education to children of their employees as a social and welfare service. SOE schools played an important role in the provision of Chinese public education (Qin & Hong, 1996; Si, 2001; J. Wang, 2003) from 1949, when the government lacked sufficient funds to finance education. In 1994, there were over 21,000 schools owned and operated by SOEs (CEFSY, 1994). These schools enrolled 9 million students and employed 900,000 teachers. SOEs contributed RMB¥10 billion as educational funds annually (CSY, 1999). More detailed information about SOE schools will be presented in Chapter 4.

Modern Enterprise System

The MES is a business system, initiated in 1993, which allows and enlarges enterprises’ decision-making autonomy and distance from the government and operation under the principles of the Chinese socialist market economy (Bai & Bennington, 2007). This system aims to reduce SOEs’ social welfare burden, refocus their business goals towards market-oriented production activities and increase market competitiveness. In education, the separation of schools from SOEs was one of requirements of the MES. The schools belonging to SOEs were required to be transferred to the Ministry of Education (MOE). These changes reduced the number of SOE schools from 21,323 in 1994 to 4,793 in 2007 (CEFSY, 2007). In 2004, the government piloted this shift of schools from SOEs to the MOE by detaching 729 State-Owned Enterprise schools with 70,069 teachers and staff from SOEs such as China National Petroleum Corporation, China Petrochemical Corporation and Dongfeng Motor Corporation. Following the success of this pilot, the Chinese government removed another batch of schools from 74 SOEs in 2005. These corporations are from industries such as nuclear, aerospace, shipbuilding, steel, metallurgy and mining, chemical, power, transportation, business investment, fishery and forestry (SASAC, 2005). Detailed information about this MES will be presented in Chapter 5.

Structure of the book

This book comprises seven chapters. In this introductory chapter (Chapter 1), the overall framework of the book is outlined by addressing the foci of study, defining the terms and introducing the overall structure of the book.

Chapter 2 (Education and Modes of Governing) provides background on the pattern of change in the governance of education globally and in China. It outlines the trajectory of public school reform in Anglo-American countries (United States, United Kingdom and Australia) and China in three time periods, namely establishing public schools, governance through bureaucracy and governance through markets. This chapter explores how states involve education in processes of governing through different “modes of coordination” (Thompson, Frances, Levacic, & Mitchell, 1991, p. 22). This mode of coordination serves as a mapping device in this chapter. Chinese education shares some similarities with the mode of governance in Western countries in the sense that once the state was central but now there is a shift from hierarchy to market. However, the trajectory is different to that of the West’s because Chinese society has undergone tumultuous changes in its socio-economic, political and cultural realms (Tsang, 2000).

The theoretical framework of the case study is constructed in Chapter 3 (Theorising Network Governance). The chapter starts by reviewing the trajectory towards governing through networks in the West and in China. Borrowing the concept of “governance” that has been developed in political science, it positions this form of governance as new governance. It elaborates this concept by comparing a definition of network governance in Western political science and policy sociology and Mohe (Xia, 2008), which provides an Asian concept of “network governance” based on research on governance in China. It then localises the concept to China by drawing on commentaries from Rhodes, Ball and Zhang, Jong and Koppenjan. This methodology reveals thematic differences related to the power of the state/“hollowing-out” of the state; membership in a policy community; the power relationship between state and social actors; and resource exchange between actors.

Chapter 4 (The Trajectory of State-Owned Enterprise Education) establishes the case of a Chinese SOE school during Chinese public education reform. Under the impact of globalisation and the Chinese Open Door Policy, SOEs were required by the central government to detach from the MOE under the MES in 1993 to enhance their market competitiveness in relation to multinational corporations worldwide. This chapter traces the birth and rise of SOE schools in China since 1949, the year of government established under the Chinese Communist Party. It builds on 15-year data from government reports and Chinese statistical yearbooks to report a general landscape of provision of education by SOEs, which includes numbers of, and diversity within, SOE schools in general and in the Ministry of Railway, their distributive location and their funding. This chapter also explores the reasons and methods for detaching schools from SOEs.

The complexity of governance in Chinese education is discussed in Chapter 5 (Mode of Governance in SOE Schooling). The governing model in the Chinese education system includes public, private (sili) and community (minban). The chapter outlines four different pathways (general education, vocational education, adult education and non-formal and lifelong education) to argue that public schools still dominate in China. Although SOE schools are grouped into the state-owned system of public education, they are not run by the MOE but by SOEs. This chapter provides a picture of the governance model in SOE schools under the central planning system and the flow of decision-making and bargaining of railway schools between governments and railway departments at various levels (central, provincial and district) under the MES. This chapter provides a case of the transformation of ownership in a Railway SOE school at Shenzhen. It shows how top-down policy is implemented from central government to ministry level, to province level, to municipal city level and, finally, to district level. Networks support negotiation and bargaining at the district level which influences the education policy of the central government.

Following on from the previous chapter, Chapter 6 (Policy Implementation Through the Transaction of Differentially Valued Resources) argues that network governance permits the exchange of resources that are differentially valued by different actors. This allows for the negotiation of win-win outcomes by transacting differently valued “goods” in the process of negotiating agreements about governing. This chapter provides evidence that resource exchange between key actors that are networked by the SOE schools make a significant and positive contribution to the process of policy implementation in China. It provides an alternative approach to solving the education problem which is different from the most common and directed method of administrative force of governments. The chapter explores the main actors and their goals, perceptions and strategies in this policy arena. It reports seven problems that have been solved through resource exchanges between actors. These problems are unqualified teachers, excess teachers, retired teachers, teacher salaries, school funding, school assets and non-teaching staff arrangements in the General Education Department of Railway Bureaus.

Chapter 7 (Governing Public Education Reform in China) concludes this study by arguing that public education reform in West and East has gone through similar trajectories in modes of governing. It confirms that network governance contributes to processes of policy implementation in China. The practice of resource transactions allows different parties to negotiate resources that they each value in different ways. This facilitates the work of making agreements about governing. Network governance is, thus, confirmed as a useful concept for understanding public education reform in West and East.

2
Education and modes of governing

Introduction

There is a longstanding debate about the best way for a government to fulfil its responsibility to educate citizens and the form of institution that should be used. Currently, public education systems are in the process of rapid and far-reaching change that is shifting the mode of governance from bureaucracies to markets and networks.

This concept of “governance” focuses attention on the way states coordinate the exercise of state power through social institutions in order to govern societies. This chapter explores the trajectories of governance that have contributed to public education reform in Western and Chinese contexts by drawing on scholarly literature and education acts or laws in the United States of America (US), United Kingdom (UK), Australia and China. It also explores how states involve education in processes of governing through different “modes of coordination” (Thompson et al., 1991, p. 22).

The “mode of coordination” is used as a mapping device, with each mode a particular way of governing socio-economic organisations (Thompson et al., 1991). Three modes of coordinating social life are identified as ideal types: hierarchy (state), market and networks (ibid.). They each entail specific governance mechanisms with their own consistent logic.

The mode of coordination within a hierarchy is based on command and is rule-driven. The directional flow of authority and demands is “downwards” from the national government to sub-national governments in a pyramid-type matrix that is familiar in many organisational arrangements with centralised administration and management.

Markets coordinate social o...

Table of contents

• Cover
• Half Title
• Series Page
• Title
• Copyright
• Dedication
• Contents
• List of figures
• List of tables
• List of abbreviations
• Acknowledgements
• Glossary
• 1 Introduction and key terms
• 2 Education and modes of governing
• 3 Theorising network governance
• 4 The trajectory of State-Owned Enterprise education
• 5 Modes of governance in SOE schooling
• 6 Policy implementation through the transaction of differentially valued resources
• 7 Governing public education reform in China
• References
• Appendices
• Index