163. Education is a matter of public concern. For individuals, it is a pathway to knowledge; for parents, it is a road to success for their children about which they are most concerned. Equipping our younger generation to achieve their full potential in a knowledge-based economy, education is also the golden key to promoting social mobility.
164. Education is the policy area which has always taken up the largest share of recurrent government expenditure. Recurrent expenditure in 2012-13 is nearly $60 billion, a jump of 28 per cent compared with 2007-08.
165. In the past few years, we have implemented a number of important education policies. On pre-primary education, we launched the Pre-primary Education Voucher Scheme in the 2007/08 school year to provide direct subsidy for parents amid the diversified development in pre-primary education. At present, over 80 per cent of kindergarten parents choose to enrol their children in schools participating in the Scheme. In the 2010/11 school year, the Scheme benefited a total of 120 000 school children with subsidies amounting to $2 billion. We also provide school fee remission under the Kindergarten and Child Care Centre Fee Remission Scheme to ensure that children will not be deprived of the opportunity for kindergarten education due to lack of means.
166. We notice that there are calls from the community for free pre-primary education. We recognise the importance of pre-primary education and have allocated substantial resources to it. The issue is not solely a question of resources. More importantly, we must first analyse where the existing system is inadequate, and identify appropriate changes. The Education Bureau will maintain dialogue with stakeholders and seek the views of different sectors to enhance the quality of pre-primary education.
167. During the past few years, we have been increasing recurrent expenditure on primary and secondary education. The Government extended free education to 12 years in 2008, incurring an additional annual expenditure of $1.2 billion. We have introduced small-class teaching in primary schools progressively since 2009. More teaching staff and resources are required due to the increased number of classes, and the estimated additional expenditure will reach $2.1 billion a year. We also started to reduce in phases the number of students allocated to each Secondary 1 class from 38 to 34. It is estimated that the additional expenditure involved will reach $1.4 billion a year. In 2009, we implemented the new senior secondary academic structure and enhanced the ratio of graduate teacher posts in public sector primary and secondary schools. These measures are expected to involve an additional expenditure of $1.6 billion a year.
168. With regard to post-secondary education, we estimate that, by the 2014/15 academic year, over one-third of the relevant age cohort will have the opportunity to pursue degree-level education. If sub-degree places are also counted, over two-thirds of our young people in the relevant age group will have access to post-secondary education. To facilitate the further development of post-secondary education, I have mentioned earlier that we shall provide $1 billion to implement a new Project Yi Jin, $2.5 billion to launch the sixth Matching Grant Scheme and $2 billion to establish more scholarships.
169. We shall also continue our two-pronged strategy to promote the parallel development of the publicly-funded sector and self-financing sector. Apart from allocating $1 billion annually for increasing the number of first-year first-degree and senior year undergraduate places funded by the University Grants Committee, the Government also provides a series of support measures to promote the development of the self-financing post-secondary sector. These measures include land grant at nominal premium, start-up loans, quality enhancement grants and accreditation grants. Last November, we also set up the $2.5 billion Self-financing Post-secondary Education Fund to offer scholarships to students and provide support to institutions to enhance the quality of education.
170. Our established policy for student financial assistance is to ensure that no student will be denied access to education due to lack of means. In the 2010/11 academic year, the Student Financial Assistance Agency (SFAA) disbursed grants and loans of over $4.6 billion under various financial assistance and loan schemes, benefiting more than 360 000 students or one-third of the total number of full-time students.
171. To give greater support to students from low-income families, the Government introduced various measures in the 2011/12 academic year, including relaxing the income ceiling for full level of assistance under the means test mechanism, adjusting the tiers of assistance, increasing school textbook assistance, enhancing the Examination Fee Remission Scheme and the Kindergarten and Child Care Centre Fee Remission Scheme, etc. The subsidy disbursed to each secondary or primary student who benefit from these measures will increase by 30 per cent to $5,000 a year on average, and the average grant per post-secondary student is also expected to increase by nearly 20 per cent to $38,000. It is estimated that the amount of grants and loans disbursed by the SFAA in the 2011/12 academic year will increase by $800 million to more than $5.4 billion.
172. The Government commenced the Phase 2 public consultation on the Review of Non-means-tested Loan Schemes for post-secondary students in November last year. Proposals put forward include measures seeking to ease the repayment burden of student loan borrowers. If the proposals are supported by the public, the Government will implement them in phases starting from the next academic year. The Education Bureau will also review the interest rate mechanism for the means-tested living expenses loans and launch improvement measures in the next academic year.