Education | Schools may need to repay subsidies if they collapse

The Bill of the Non-Tertiary Private Education Statute has no stipulations on how government subsidies should be handled if a school collapses or becomes profitable, the legislature’s 2nd Standing Committee pointed out yesterday.

“In the future, will the government have the right to forbid a school from turning from unprofitable to profitable?” asked Chan Chak Mo. “Can the government ask the school to return the subsidies they received before [becoming profitable]?”

Chan stressed that there are no such stipulations in the Bill, adding that the government is open to the committee’s reminders, as this may occur in future.

“We understand the omission, because in the previous 20 years, our public finances have been strong and there has been no case of a school going bankrupt,” Chan said. “The government has been providing sufficient subsidies to schools, so theoretically there was no chance for the situation to happen.”

Citing the government, Chan explained that government subsidies offered to schools for the construction of campuses or teaching buildings require a written pledge from schools, to ensure the structures will be used for educational purposes for a certain period of time.

The government has also told the committee that further studies will be needed to stipulate how the situation should be handled if a school becomes bankrupt. AL