Executive summary

Since regaining independence in 1990, Lithuania has clearly stated the importance of education to societal development. The National Education Strategy 2013-22 includes a focus on education as a foundation for the future and a commitment to increase the level of investment from public funds in education to 6% of Gross Domestic Product (GDP) in 2022. However, the international financial crisis hit the Lithuanian economy harder than on average in OECD economies. A far-reaching convergence programme includes a target reduction for educational expenditure from 6.2% to 4.8% of GDP in 2020. Already, public expenditure per student in Lithuania is one of the lowest among European Union countries. There has also been mass emigration since 1990, with around 20% of the 1990s population leaving Lithuania over the following 20 years. The majority of emigrants are of working age and, increasingly, families. This has presented significant efficiency challenges to the school network. Also, international data reveal considerable concerns with the quality of school education in Lithuania, including significant rural-urban disparities.

Lithuania has developed policies to address these significant challenges. Since 2005, the Education Law places responsibilities on municipalities to have in place an optimal network of schools. This required the development and agreement of initial plans within all 60 municipalities and has seen considerable reorganisation of the school network, with the total number of municipal schools reducing from 1 429 to 1 107 between 2005 and 2015. School consolidation initiatives were supported by a set of national documentation providing a rich array of data, analytics and models that was a key resource in negotiating politically difficult times with different municipalities. Also, home to school transport was recognised as integral to the reform, with the purchase of almost 700 buses between 2000 and 2014. In 2001, Lithuania introduced a central funding formula to allocate resources for teaching costs, known as “the student basket”. The implementation of the new financial arrangement indisputably improved the allocation and use of resources in education in many respects: it allocates funds in a very transparent and predictable way; the formula has a simple logic which can be well understood by stakeholders, in spite of the complexity of the exact calculations; it includes weightings to support smaller, rural schools; and it is, in general, accepted by most municipalities and schools as a fair method of allocation. Collectively, these efforts helped to stem the decline in student-teacher ratios.

However, cost-effectiveness remains low in international comparison. In Europe, Lithuania has the second highest concentration of teachers in the active population. In lower secondary education, national data show a steady and continuing decline in average class size between 2005 and 2015, including a clear decline in urban schools, so this cannot be attributed to a rural, small school phenomenon. The high share of teachers above fifty years of age or already retired stands out in international comparison. In 2015, 7.1% of Lithuanian teachers were at the retirement age. This implies that in the medium or long term Lithuanian schools may encounter sudden teacher shortages. Unfortunately, the current conditions in the teacher labour market do not attract talented young people: there is a small number of vacancies and new recruits are likely to be at or near the minimum salary, which relative to national income (GDP per capita) is one of the lowest in Europe.

This report analyses the use of resources in the Lithuanian school system, with a particular focus on the organisation of the school network, the funding of school education, and the management of the teaching workforce. The following policy priorities were identified to improve the effectiveness of resource use in the Lithuanian school system.