The Second Congressional Commission on Education (EDCOM 2), together with UNICEF Philippines, conducted a field visit to Gapan City School Division Office and Gapan East Integrated School on October 29, 2024 to learn about good practices on financing public school operations.
The division was selected because, despite the resource limitations of a fourth income class city, two schools from the division, Gapan East Integrated School and Kapalangan National High School, obtained higher than average National Achievement Test scores.
The meeting was attended by EDCOM 2 Co-Chairperson Sen. Win Gatchalian, Executive Director Dr. Karol Mark Yee, DepEd Secretary Sonny Angara, EDCOM 2 Advisory Council Members Doris Ferrer and Olie Lucas, together with Basic Education Subcommittee Member Elvin Ivan Uy and DepEd Undersecretary for Operations Revsee Escobedo. Gapan City Mayor Joy Pascual was also in attendance, together with DepEd Central Luzon Regional Director Dr. Ronnie Mallari and Gapan City Schools Division Superintendent Ms. Teresa Mababa. UNICEF Philippines Deputy Representative for Programmes Behzad Noubary was also in attendance, together with UNICEF Philippines Chief of Education Akihiro Fushimi and Chief of Social Policy Maya Faisal.
EDCOM 2 findings show that current levels of school maintenance and other operating expenses (MOOE) budgets are insufficient to fully cover the operating costs of public elementary and high schools.
Prior consultations with school heads conducted by the Commission’s Governance and Finance Standing Committee reveal that 30–70% of the school MOOE budget is spent on utility bills alone, which leaves meager funds available for improvement projects and initiatives that could address local needs and support better learning.
LGU, community support key to NAT success
During the visit, EDCOM 2 observed how essential resources, such as adequate classroom facilities and up-to-date learning materials have a significant impact on student engagement and achievement. Despite limited local resources and School MOOE allocations, Gapan East Integrated School and Kapalangan National High School have attained above average National Achievement Test scores in the domains of problem solving, information literacy, and critical thinking.
Top-performing Schools from the Divisions identified by UNICEF to have low per capita MOOE & SEF
“If you look at the names ng mga top performing schools, it’s usually the cities with large purses, and yet Gapan – with a fairly average budget among cities and LGUs, is doing above average and good results, and that is an indicator of quality,” said DepEd Secretary Sonny Angara.
“It is a marching order of the President to raise the quality of education through local and international assessments, and hopefully we can replicate the good practices Gapan did, to the rest of the country,” he added.
In 2021, Gapan accrued a Special Education Fund (SEF) income of Php 9.6 million — which is 40% lower than the average for fourth income class cities. Gapan’s SEF spending has averaged at 94% from 2018 to 2022. The Commission also calculated that Gapan’s 2021 school MOOE allocation from the national government is estimated at PhP 1,290 per student – slightly higher than the national average estimated at PhP 1,167 per student. Combining per capita School MOOE and SEF yields an estimated PhP 1,599 allocation per student by the local and national government.
Estimated per capita (school MOOE + SEF), FY 2021
Gapan’s practices highlighted the role of the local government, the Schools Division, as well as the community in providing schools with the support needed to improve learning outcomes. Complementing the national government’s School MOOE funding with partnerships, donations, and LGU support have enabled the school heads and teachers of Gapan East Integrated School and Kapalangan National High School to address resource gaps and foster conducive learning environments. From the visit, it was evident that the local school community had worked hand in hand to provide both print and digital learning resources to the learners of Gapan, with a focus on developing foundational skills in literacy and numeracy.
Despite efforts, however, the schools still face resource constraints. With limited School MOOE funding, access to technology for learning remains a challenge. “Although we have computers, wala naman kaming internet connection,” said Gapan East Integrated School Principal Julita Aguilar when asked if they are able to provide computers for the school. The school is also affected by the high backlog in classroom construction, with one building marked for condemnation.
“We need to review how we compute the School MOOE. It needs to truly reflect the needs on the ground and also a good spending strategy from the school leader,” said EDCOM 2 Co-Chairperson Senator Sherwin Gatchalian. “Of course gusto natin ng higher MOOE, but what we see here today is that if the principals spend it on learner development, on direct learning programs, we can see that the effects are positive.”
DepEd, EDCOM 2 hopeful with new normative formula
Historically, the “Boncodin formula” determined MOOE budgets based on fixed costs and variable factors, which include enrollment size, number of teachers, number of graduating students, and classroom count. DepEd has made adjustments to the coefficients to account for inflation through the years, but limited documentation made it difficult for the agency to justify proposed budget increases based on the Boncodin formula.
As part of its technical assistance to DepEd, the Asian Development Bank (ADB) conducted a study reviewing the Boncodin formula. The ADB found that the Boncodin formula is biased against schools with high student-to-classroom or student-to-teacher ratios. This results in lower School MOOE per student, exacerbating resource challenges in schools experiencing congestion. Due to limited buildable space in congested areas, fewer classrooms are built. This in turn minimizes the contribution of student enrollment to the computed School MOOE allocation.
In the same study, ADB surveyed over 10,000 schools to collect updated cost estimates of 27 variables that influence the cost of school operations, such as classrooms, utilities, science and math kits, printing expenses incurred by teachers, and the like. Using these computations, ADB proposed a new normative formula based on the least amount of MOOE needed by a school to comply with the Department’s current service standards.
In coordination with the Department of Budget and Management (DBM), DepEd adopted a modified version of the ADB formula, resulting in a 32% overall increase of School MOOE allocation in the 2025 National Expenditure Program.
In a separate forum conducted by the Commission with the ADB and DBM on October 21, DBM committed to implementing the full formula in FY 2026. The result would be an estimated 85% increase in the overall School MOOE budget.
EDCOM 2 considers the new formula as a welcome development. However, it also recommends that DepEd further review the minimum service standards to enable teachers to adopt learner-centered and inquiry-based approaches.
EDCOM 2 Executive Director Dr. Karol Mark Yee raised questions to further review these standards. “For instance, what are the needs of schools implementing special curricular programs, like science elementary and secondary schools, on top of the usual operating costs of public schools? What minimum service standards would support and foster learning as envisioned in recent curricular reforms?”, he said.
