Education Reforms: Is the Private Sector Being Left Behind?

In recent years, Mexico has introduced a series of educational reforms aimed primarily at improving access and quality within public institutions. While these changes have been lauded for their inclusive intentions, they have, in practice, placed private educational institutions at an economic, operational, and fiscal disadvantage. The exclusion of private schools from crucial financial support mechanisms, such as the recently introduced "Rita Cetina" universal scholarship for basic education, underscores a growing imbalance that inadvertently disincentivizes parents from choosing private education. This article explores the ramifications of these reforms and calls for a more equitable policy approach that recognizes the role of private education in enriching Mexico's overall educational landscape.
 

Economic Impact

The Rita Cetina universal scholarship was introduced to address economic barriers for families with children in basic education; however, it is exclusively available to students in the public sector. By restricting this financial aid to public institutions, the government has effectively sidelined families who choose private education despite financial hardship, thereby creating a two-tiered system that places public and private institutions in opposition. This policy not only exacerbates inequality but also reduces parental agency in choosing the best educational environment for their children, as financial incentives are now structured to favor public over private education.

International examples highlight the importance of extending financial support across both public and private institutions to foster healthy competition and drive quality improvements across the sector. Countries such as Canada and Finland demonstrate how universal scholarships and vouchers provide families with financial assistance regardless of whether they choose public or private schools. These policies empower parents to make decisions based on the specific needs of their children, rather than financial constraints, thus ensuring that access to quality education remains equitable across all types of institutions. By neglecting similar models, Mexico risks creating an education system where quality and accessibility are compromised by financial inequity.

However, Mexico's current fiscal constraints exacerbate the challenge. As one of the countries within the OECD with the lowest tax revenue — collecting only 16% of GDP compared to the OECD average of 34% — the government faces a critical funding gap. President Claudia Sheinbaum's proposed 2025 budget continues this trend, projecting a fiscal deficit and ongoing red numbers. Sustaining programs like the Rita Cetina scholarship for public schools alone is already fiscally tenuous, and extending such support to private schools would require a fundamental overhaul of Mexico's tax and budget policies. Without structural changes, these reforms risk being unsustainable for both sectors.

 

Operational Challenges

Beyond financial disparities, private schools face substantial operational hurdles in adapting to government-mandated reforms, such as those within the framework of the "New Mexican School." This reform mandates extensive curriculum and pedagogical changes to promote a more holistic and inclusive education. Public schools benefit from government funding, resources, and professional development programs to support these reforms, while private schools are expected to self-finance these updates. Without equivalent operational support, private schools must allocate their limited resources to meet reform requirements, detracting from investments in teacher development, facility upgrades, and other critical needs.

Countries with successful dual-sector education models recognize the importance of supporting both public and private institutions in meeting national curriculum standards. For example, Colombia, which has a similar education budget to Mexico, employs a subsidy program that funds private schools for enrolling low-income students. This approach ensures equitable access while relieving public schools of excess demand. Similarly, Peru's "Colegios en Convenio" program channels public funds to private institutions in underserved areas, bridging gaps in quality and access without excluding private schools.

In Mexico, however, private institutions face the additional challenge of operating without state support for these mandated changes. Consequently, these reforms disproportionately burden private schools, leaving them to navigate regulatory demands and financial constraints without the resources provided to their public counterparts.
 

Fiscal Pressures

On top of economic and operational challenges, private institutions face stringent tax obligations that place additional financial strain on their operations. Public schools are entirely tax-exempt, but private schools must comply with the Income Tax Law (Ley del Impuesto sobre la Renta), which includes corporate taxation on non-tuition revenue and value-added tax (VAT) on certain services. These fiscal requirements create significant pressure, particularly for smaller institutions that already struggle with limited resources.

Other nations with similar economic constraints have implemented measures to alleviate the tax burden on private schools. For example, Brazil offers tax incentives for private institutions that serve low-income students or provide specialized educational services, ensuring that private schools can remain competitive while meeting public policy goals. Mexico, by contrast, imposes additional costs on private schools, further straining their financial sustainability.
 

A Comparative Perspective

The challenges faced by Mexico’s private schools underscore the importance of re-evaluating the country’s approach to educational policy. International models illustrate the benefits of inclusive policies that treat public and private institutions as complementary partners rather than competitors. Notable countries, such as Finland, the Netherlands, Denmark, Singapore, and the United Kingdom, offer examples of balanced policies that could serve as valuable references for Mexico.

In Finland, where educational equity is a cornerstone, public and private institutions both receive state funding based on student needs, not on the type of institution they attend. This approach allows families the freedom to choose schools that best meet their children’s educational requirements, ensuring that private and public schools alike provide high-quality, accessible education.

The Netherlands similarly promotes balance by providing equal funding to public and private schools based on enrollment numbers. This policy has led to a diverse education system where 70% of students attend government-funded private schools.

Denmark offers vouchers and near-equal funding for private schools, minimizing socio-economic barriers while encouraging innovation and diversity in education models.

Closer to home, Colombia and Peru show how limited budgets can be effectively utilized to support both public and private education through targeted subsidies and public-private collaborations. These approaches not only alleviate strain on public schools but also enhance access to quality education for all socio-economic groups.
 

Toward a Balanced, Inclusive Future

As Mexico moves forward, it is clear that the current trajectory is financially unsustainable. An inclusive approach is necessary — one that recognizes the contributions of private schools as a valuable pillar within the broader educational system. By fostering a collaborative environment, the government can ensure that private institutions remain viable, accessible, and capable of delivering the quality education that so many families seek. However, sustaining these changes will require significant fiscal reforms, including expanding the tax base to fund educational programs more comprehensively.

At Cometa, we are committed to supporting this vision by empowering private schools with data-driven tools that optimize resources and improve operational efficiencies. Our platform enables schools to enhance financial planning, reduce administrative burdens, and focus on delivering high-quality education. By equipping schools with effective management solutions, Cometa helps institutions navigate these challenges and thrive as indispensable contributors to Mexico’s educational landscape. Together, we can work toward an equitable system where all students have access to the opportunities they deserve, fostering innovation, progress, and inclusion for generations to come.