Non-state preschool education: current practices of territorial development

Ensuring accessibility of preschool education is one of the most important tasks, which solution does not only affect the education system itself, but also the socioeconomic situation in the country, contributing to the employment of families with young children, thereby increasing their welfare. The main targets of preschool education in the medium term are defined in the RF President Decree “On measures on state policy implementation in the field of education and research” No. 599 of May 7, 2012 (achievement of 100% accessibility of preschool education for children aged 3–7 to 2016) and the National strategy of actions in the interests of children for 2012–20171. The main expected results of the Strategy realization are the following: provision of general availability of preschool education for all categories of children, increase in the flexibility and diversity of forms of pre-school services through the implementation of existing and additional forms of their financing and organization, etc.

According to the Federal State Statistics Service of the Russian Federation, the total number of children registered in pre-school educational institutions amounted to 2.7 million people in 2013. That is by 13% more than in 2012 and by 2.8 times more than in 20052.

However, families’ requirements in preschool education for children aged 18 months are more relevant and significant. When a child reaches this age, the payment of state benefits is terminated3 and, accordingly, parents want to go to work: it is especially important for singleparent families4. However, the public sector of preschool education for children of this age does not guarantee a place in kindergarten. The task to provide the consumer market with the services, such as supervision and care for toddlers, their development and education, could be fulfilled by the private sector. The study of the state and problems of private enterprise development in preschool education is the purpose of this article.

All trends in preschool education of Russia in the period from 1991 to 2015 are based on the changes in socio-economic life of the country ( tab. 1 ).

In 1990–2013 the number of kindergartens in Russia decreased twofold (from 88 to 43 thousand units). This happened due to baby bust, closing of kindergartens and transfer of facilities either to primary schools, or commercial structures. In the 1990s the outflow of children from pre-school facilities was associated with financial problems as well (someone could not pay for them, someone hired a babysitter) [22, p. 18]. The analysis of the given data (tab. 2) shows that during the period of economic transformations in the social sphere (the 1990s – the beginning of 21st century) and in modern conditions (2010– 2015) the system of preschool education experienced and continues to experience tensions.

Today, one pre-school organization in the country accounts for by 24% of children more than in 2010 (148 pupils in 2013 versus 119 in 2010) and almost by 1.5 times more than

Table 1. Features of preschool education sphere development in Russia in the post-reform period (1990-2015)

Period Trends and features of the period Early 1990s Maximum number of kindergartens during this period (about 88 thousand). Pre-school education was characterized by departmental affiliation of most institutions that gave advantages in material resources, etc. The coverage of preschool services accounted for more than 66% Mid 1990s Massive reduction of the network of kindergartens. Four-five thousand organizations were annually closed (reformed, etc.). It mostly concerned departmental educational institutions, which were transferred to municipalities. The coverage of children by preschool educational institutions was decreased (55%) (parents were granted leave to care for a child under the age of 3, the parent fee grew) Late 1990s – early 2000s Gradual recovery from the crisis situation. The PEI network continues to decline, but at a slower rate (in 2002 1,100 kindergartens were closed). The coverage of children by preschool education accounted for 56%; demand of preschool institutions increased, especially groups for children under 3 years of age 2005 – 2010 In preschool education the long decline of contingents came to an end, there was a slight growth in the number of children attending kindergartens. There was a rise in the coverage of children by preschool educational institutions – 61% in 2005 2011 – 2015 Emergence of the crisis situation in provision of the child population with pre-school education establishments. In 2013 the coverage of children by preschool educational institutions amounted to 63% of the total children of appropriate age. The demand for preschool education increased dramatically due to the grown birth rate due to, on the one hand, the entry of representative of the cohort born in the 1980s into reproductive age and, on the other, the state measures (maternity capital, etc.) Source: compiled by the authors; Chislo doshkol’nykh obrazovatel’nykh uchrezhdenii [Тumber of preschool educational institutions]. Available at: (data obrashcheniya:15.10.2015).

Table 2. Number of preschool institutions in the Russian Federation and number of pupils (at the year-end)

Area 2010 2011 2012 2013 Urban Rural Urban Rural Urban Rural Urban Rural Number of preschool organizations*, thousand units 26.7 18.4 26.9 18.0 26.5 17.8 25.7 17.5 45.1 44.9 44.3 43.2 Number of pupils in pre-school institutions, total, thousand people 4,280.6 1,107.3 4,502.4 1,158.8 4,750.6 1,232.2 5,037.1 1,310.2 5,388.0 5,661.1 5,982.9 6,347.3 * Including the structural units (branches) of pre-school educational institutions. Source: Federal State Statistics Service of the Russian Federation. in 1990. The number of children5 per 100 pre-school places in 2013 amounted to 105 people, including 108 in cities and urban-type settlements and 93 in rural areas.

The main factor stimulating the development of private entrepreneurship in this field is the shortage of places in public kindergartens. The promotion of the nonstate preschool education sector is part of the state policy in the sphere of attracting private investment in the education system. In the Annual Address to the Federal Assembly6, December 4, 2014, Russian President Vladimir Putin said: “We must eliminate discrimination of the non-governmental sector in the social sphere, remove all its barriers” [20].

Nowadays in Russia there are about 50 thousand public kindergartens and only 1200 private ones. Around 600 kindergartens are registered as non-profit organizations7. The share of private kindergartens accounts only for 1.3% of the total number of kindergartens. Moreover, 66% of all private kindergartens are concentrated in 8 RF regions, with Moscow, the Samara Oblast and the Omsk Oblast being the leaders. According to target indicators of the “road map” (action plan) “Support of the access of non-state organizations to the provision of services in the social sphere”, prepared by the Agency for Strategic Initiatives of Russia, non-state preschool organizations are to provide children aged 12 months– 7 years with education: by 2016 – 8% of children, by 2018 – 15%.

Today, according to the Minister of Education and Science Dmitry Livanov, the share of private licensed kindergartens is significantly higher than the national average (1.8%) in such RF subjects, as the Sakha (Yakutia) Republic – 4.5%, Primorsky Krai – 3.1%, Khabarovsk Krai – 3.5%, the

Sverdlovsk Oblast – 5.5%, Yamalo-Nenets Autonomous Okrug – 6.2%, the Republic of Karelia – 4.4%, the Irkutsk Oblast – by 3.0%, Krasnoyarsk Krai – 3.0%, and Moscow – 6.3%. At the same time, there are regions that have no non-state kindergartens, such as the Kabardino-Balkar Republic, Kamchatka Krai, and the Tambov Oblast [3, 11].

The study shows that, in general, Russia has formed the legislative basis for the functioning of non-state preschool education establishments of different types and their support on the part of federal and regional authorities . In particular, the rights and responsibilities of individual entrepreneurs are equal to state organizations operating in the sphere of preschool education. The conditions and mechanisms of financial support and tax exemptions for private kindergartens are determined.

The functioning of non-governmental organizations of preschool education is regulated by the federal law “On education in Russian Federation” of December 29, 2012 No. 273-FZ [15].

In 2010 the federal law “On non-com-mercial organizations” No. 7-FZ included Article 31.1 “Support for socially oriented non-profit organizations by public authorities and bodies of local self-government” [18]. According to this article, organizations, performing activity in the field of education (including preschool), are classified as socially-oriented. It describes forms of their support ensured by the authorities of RF subjects and bodies of local self-government, such as:

– financial, property, informational, consulting support, as well as support in the field of training, retraining, advanced training and additional professional education of employees;

– provision of privileges on payment of taxes and fees;

– placing of orders for execution of goods, performance of works, rendering of services for state and municipal needs in the procedure provided for by the federal law of July 21, 2005 No. 94-FZ;

– guaranteeing legal persons, financially supporting socially oriented non-profit organizations, exemption from taxes and duties in accordance with the law.

The Ministry of Economic Development of Russia assists small and medium enterprises in form of subsidies to the RF subjects [19] (Ministry of Economic Development Order of April 24, 2013 No. 220). The new sanitary-epidemiological requirements to preschool groups, located in apartments and private homes are approved [17, 23].

May 3, 2015 the Russian President signed the law, stipulating that private day care organizations for early childhood education are exempt from profit tax [13]. Such organizations are entitled to the zero tax rate on profit. The new rule concerns kindergartens, pre-school and after-school care groups at schools8.

Let us consider the formation of the framework for private entrepreneurship in the sphere of preschool education on the example of a specific territory (the Vologda Oblast and Vologda).

Table 3. Key indicators of the preschool organizations functioning in the Vologda Oblast

Indicators	Year								2014 to 2000, %
	2000	2008	2009	2010	2011	2012	2013	2014
Number of preschool organizations	683	624	617	600	598	577	560	490	71.7
Number of pupils, thousand people	51.5	60.8	61.8	62.9	65.1	67.4	70.7	72.9	141.5
Number of children per 100 places	76	103	104	106	103	101	102	104	136.8
Sources: Detskie doshkol’nye uchrezhdeniya v Vologodskoi oblasti v 2004–2008 godakh : stat. sb. [Preschool Institutions in the Vologda Oblast in 2004–2008 : Statistics Digest]. Vologdastat [Territorial Body of the Federal State Statistic Service in the Vologda Oblast]. Vologda, 2009. 42 p.; Doshkol’nye obrazovatel’nye organizatsii Vologodskoi oblasti v 2010 – 2014 godakh : stat. sb. [Preschool Institutions in the Vologda Oblast in 2010–2014 : Statistics Digest]. Vologdastat [Territorial Body of the Federal State Statistic Service in the Vologda Oblast]. Vologda, 2015. 63 p.

Table 4. Key indicators of the preschool organizations functioning in Vologda

Indicators Year 2014 to 2000, % 2000 2008 2009 2010 2011 2012 2013 2014 Number of preschool organizations 78 82 82 82 83 84 86 85 108.9 Number of places 17,047 13,856 13,978 13,698 16,740 16,968 17,430 17,649 103.5 Number of pupils 12,795 16,177 16,630 16,781 17,840 18,642 19,867 20,443 159.8 Number of children per 100 places 75 117 119 123 107 110 114 116 154.7 Sources: Data of the Federal State Statistics Service of the Russian Federation. Available at: ; Detskie doshkol’nye uchrezhdeniya v Vologodskoi oblasti v 2004–2008 godakh : stat. sb. [Preschool Institutions in the Vologda Oblast in 2004–2008 : Statistics Digest]. Vologdastat [Territorial Body of the Federal State Statistic Service in the Vologda Oblast]. Vologda, 2009. 42 p.; Doshkol’nye obrazovatel’nye organizatsii Vologodskoi oblasti v 2010 – 2014 godakh : stat. sb. [Preschool Institutions in the Vologda Oblast in 2010–2014 : Statistics Digest]. Vologdastat [Territorial Body of the Federal State Statistic Service in the Vologda Oblast]. Vologda, 2015. 63 p.

In the Vologda Oblast, as in the whole country, the network of preschool educational organizations gradually reduced in 2000–2014 ( tab. 3 ).

In comparison with 2000 their number decreased from 683 to 490 units, or by 28%. At the same time, the number of pupils in kindergartens rose from 51.5 thousand to 73 thousand, or by 42%. This was reflected at the demand for a pre-school place. In 2000, 100 places accounted for 76 children, in 2014 – 104. There are 261 pre-school organizations in the region, while the number of pupils exceeds the number of places. According to the 2014 data, the share of children aged 1–6 attending the Vologda Oblast kindergartens amounted to 83% of the total number of children of this age. This is significantly higher than the average value in the Russian Federation (63.1%) and the Northwestern Federal District (76%). The enrolment rates in preschool education increased in 2012 and 2013 by 3 percentage points, despite the reduction in the number of kindergartens. There is an increase in the coverage of children under the age of 3 with preschool education: 33.1% in 2013 against 30% in 20129.

During the study period the number of kindergartens in Vologda grew from 78 to 85 (tab. 4). They include 20,443 pupils. In comparison with 2000 their number increased by 7,648 people, or 60%. At the same time, the number of places in kindergartens grew only by 3.5%: 17,047 places in 2000 against 17,649 in 2014.

Preschool education organizations of the regional center are “overloaded”, as the number of their pupils exceeds the number of places: 100 places per 116 pupils (in 2000 – 75, respectively). This overcrowding results in the deterioration of children’s health. So, in 2014 of 100% days children did not attend kindergartens 25% were missed due to illness ( tab. 5 ).

The increasing demand for preschool education is still largely unmet. This is one of the critical social problems today. More than ten thousand young people are registered to get a place at a preschool educational organization. Compared to the previous year’s level, the queue increased by 2%, and since 2006 – by 2.8 times (tab. 6) . In the Vologda Oblast 28 thousand children wait for a place in a kindergarten, of which 36% – in Vologda.

Table 5. Attendance in pre-school institutions in 2014

Territory	Total attendance, days	Missed, days	Including
			Due to illness	For different reason
Vologda Oblast	12,748,927	4,805,048	1,218,901	3,586,147
Vologda	3,726,661	1,442,078	365,868	1,076,210
Sources: Doshkol'nye obrazovatel'nye organizatsii Vologodskoi oblasti v 2010 – 2014 godakh : stat. sb. [Preschool Institutions in the Vologda Oblast in 2010–2014 : Statistics Digest]. Vologdastat [Territorial Body of the Federal State Statistic Service in the Vologda Oblast]. Vologda, 2015. 63 p.

Table 6. Indicators of provision with places in preschool educational institutions of the Vologda Oblast and Vologda, people

Indicators of provision	Year									2014 to 2013, %
	2006	2007	2008	2009	2010	2011	2012	2013	2014
Vologda
Number of children registered to get a place in pre-school organizations (people)	3,640	4,264	4,872	4,851	4,994	8,044	9,084	9,828	10,054	102.2
Number of children who got a place in pre-school organizations, people	2,633	2,409	2,968	3,559	3,909	4,365	4,218	4,778	3,942	82.5
Difference, people	1,007	1,855	1,904	1,292	1,085	3,679	4,866	5,050	6,112	121.0
Vologda Oblast
Number of children registered to get a place in pre-school organizations (people)	7,500	11,965	14,521	14,545	15,724	19,087	19,929	28,927	27,736	95.8
Number of children who got a place in pre-school organizations, people	-	-	12,083	13,750	14,036	14,785	15,469	17,172	16,084	93.6
Difference, people	-	-	2,438	795	1,688	4,302	4,523	11,755	11,652	99.1
Sources: Detskie doshkol’nye uchrezhdeniya v Vologodskoi oblasti v 2004–2008 godakh : stat. sb. [Preschool Institutions in the Vologda Oblast in 2004–2008 : Statistics Digest]. Vologdastat [Territorial Body of the Federal State Statistic Service in the Vologda Oblast]. Vologda, 2009. 42 p.; Doshkol’nye obrazovatel’nye organizatsii Vologodskoi oblasti v 2010 – 2014 godakh : stat. sb. [Preschool Institutions in the Vologda Oblast in 2010–2014 : Statistics Digest]. Vologdastat [Territorial Body of the Federal State Statistic Service in the Vologda Oblast]. Vologda, 2015. 63 p.

Table 7. Forecast of the number of children aged 0–3 in Vologda for 2015–2023, people*

Age	Year
	2014**	2015	2016	2017	2018	2019	2020	2021	2022	2023
2 years	3,947	4,308	4,240	4,190	4,147	4,110	4,087	4,076	4,063	4,041
3 years	3,826	3,946	4,307	4,239	4,189	4,145	4,108	4,086	4,075	4,061
* It is an inertial forecast scenario, which assumes the permanence of sex-age fertility and mortality rates throughout the forecast period. ** Factual data. Source: compiled by the authors.

In the regional capital, according to the results of the inertial forecast for the medium term, implying the permanence of sex-age fertility and mortality rates, the number of two-year and three-year-olds will not reduce in the coming years (tab. 7) . The peak growth of children aged 3 will be in 2016; compared to 2014 the number of this population group will increase by 13% (4,307 children). In 2023 it will be by 6% more than in 2014 (4,041 children). Nowadays (2015) we observe the peak of growth in the number of children aged 2 – which is by 9% more than in the previous year. In 2014–2023 the number of two-year old children will grow from 3,947 to 4,041, or by 2%.

The forecast data indicate that in the near future the load on the municipal network of preschool education will increase. Taking into account the growth in the number of two-year-olds and the unceasing demand for preschool education services for this category of citizens, we should emphasize that the problem of accessibility of pre-school education will remain relevant [9].

The regional authorities have recently adopted a series of documents that define measures to support the non-state sector of preschool education in the Vologda Oblast, in particular the Procedure for determining the amount and paying subsidies for the provision of pre-school education in private educational institutions (the Vologda Oblast Government decree of March 3, 2014 No. 169). In accordance with this document, private pre-school educational institutions having the license for realization of educational activity get subsidies for salaries, purchase of textbooks, teaching AIDS, toys (with the exception of expenditure on maintenance of buildings and utilities).

In the Vologda Oblast there are 5 private organizations, having the license for realization of educational activity and guaranteeing the provision of 665 places10. In the first half of 2014, 48 individual entrepreneurs and 33 legal entities registered their activity as “Preschool education” according to the all-Russian classification.

Private entrepreneurship in the sphere of preschool education, according to the study, is more characteristic of urban areas. For example, in Vologda there are more than 40 private organizations, including licensed and unlicensed. It is difficult to identify their exact number for a number of reasons. First, the activities of such organizations are very dynamic. Individual entrepreneurs can start and then terminate their business without notification of tax authorities. Second, there is a share of the shadow economy. Only two organizations have licenses (“Kid” and “Sprout” with 9 branches). Other organizations are registered as individual entrepreneurs and fulfill the function of supervision and care of children. Judging by the study results11, entrepreneurs providing services of supervision and care of preschool children do not seek to obtain a license for realization of educational activity, as, according to them, “registration is associated with the collection of a large number of documents, and this, in turn, requires a lot of time and effort”. Licensing is considered as a major barrier among the managers of non-state child centers and mini-gardens in Moscow, according to the survey [21, p. 86], conducted by the National Research University Higher School of Economics with support of the NGO “Council for Management and Development” and the Department of Social Protection of Moscow12: “...we call it as supervision, because it is very difficult to get a license”. “To get an educational license is very difficult. Because it is very difficult to get a fire license...”, – the managers of private kindergartens of the city of Taganrog in the Rostov Oblast claim [1, p. 102]13.

Moreover, some leaders of this business, as it became clear during the participant observation in Vologda, do not find it necessary to have a license. The licensed private kindergartens are controlled by the regional authorities. The activities of unlicensed preschools are not monitored, unless there is a formal complaint from neighbors or parents: “There is no communication with authorities, we do not feel either control, or interest in our activities on the part of education authorities. The city government does not have sufficient information on the activities of the private sector of preschool education”. The analysis of private institutions of preschool education shows a lack of information about the licensing procedure; thus, these organizations have certain concerns. The municipal and regional authorities interested in the private sector development should support it not only in terms of paperwork, but also provide information about existing possibilities of state support to the non-state sector of preschool education, thereby stimulating individual entrepreneurs take their business to the next level. The conclusion is shared by the HSE researchers (for example, O.B. Savinskaya [21]), who claim the need for “additional campaign that informs mini-organizations operating as individual entrepreneurs about new opportunities for rendering educational services without licensing, stipulated in the new law “On education in the Russian Federation”14. O.B. Savinskaya also calls to work out a simplified licensing system for organizations that operate as NGOs and provide educational services [21, p. 87].

Nowadays the effective work is impossible without long-term collaboration, combining resources to achieve concrete results and distributing responsibilities and risks between private and public partners. The licensed private kindergartens “Sprout” and “Kid” demonstrate good examples of effective collaboration. “Sprout” got a license in July 2013. At first, the organization consisted of 3 branches, today it is a network of 9 kindergartens located in different districts of Vologda. The rapid development of “Sprout” is influenced by the cooperation with OJSC “Vologda Region Development Corporation” that from the very beginning of the kindergarten functioning stimulates its growth by providing informational, legal and methodological support.

The private kindergarten “Kid” received a license in February 2015. It was created with the assistance of the private educational institution of additional education “Center “Ego” and with the support of the Department of Psychology and Pedagogics of the Vologda State University.

The child’s stay in a licensed private kindergarten costs approximately 9 thousand rubles a month. One of the surveyed kindergartens has a system of discounts for early payment for some (2 to 12) months. In the period of child’s adaptation to a kindergarten (1–2 months) parents pay by 2 thousand rubles less.

According to the Russian legislation15, citizens whose children attend kindergartens are entitled to compensation. It is return of parent fees paid for attendance at kindergarten. The amount of compensation is fixed in the normative legal acts of RF subjects, but it is not be less than [15]:

– 20% of the average size of parent payment for supervision and care of children in state and municipal pre-school educational organizations located on the territory of the corresponding RF subject, for the first child;

– 50% of such payment for the second child;

– 70% of such payment for the third child and subsequent children.

The resolution of the Vologda Oblast Government16 stipulates the average size of parent payment for supervision and care of children in state and municipal pre-school educational organizations – 1,450 rubles. In this regard, the calculation of compensation of part of parental fee to parents of a child attending a licensed private kindergarten is based on the size of this amount. Until recently compulsory tax amounting to 13% (PIT) has been levied. However, since January 1, 2015 on the initiative of Vologda Oblast deputies this tax has not been collected and, therefore, the amount of returned payment has increased. Moreover, parents are eligible to social tax deduction in the amount that they have paid for education of their child in kindergarten as long as the organization has a license17.

The cost of services provided by unlicensed private kindergartens varies from 8,000 to 13,000 rubles per month. On average the parental fee amounts to 10,230 rubles, which is by 14% higher than in licensed kindergartens. Of 10 unlicensed private kindergartens 3 organizations have fees above average and 3 – below. In most cases there are no specific relations between the cost of services in unlicensed private kindergartens, their location in the city, conditions of placement, facilities, and the number of teachers and children. In the process of pricing some heads do not rely on certain rules of the market and set their fees on the basis of purely personal interests, ambitions, level of aspiration, and social positioning of their business. Some heads of unlicensed private gardens are focused exclusively on families with income above average. In some cases the higher cost is justified: scenic area, 3 teachers and 1 junior teacher for a group, 5 meals, modern toys and educational games, weekly inspection by a pediatrician, surveillance cameras. However, some kindergartens set the fees, not corresponding to the quality of services provided, relying on stable demand for places in preschool educational institutions in the city. Currently in the regional capital the private sector of licensed kindergartens provides approximately 165 places, but more than 10 thousand kids are in line for admitting to municipal kindergartens. A simple mathematical calculation can show that there is sufficient demand for child care services rendered by individual entrepreneurs.

Thus, the non-state sector of educational services in the sphere of preschool education is forming in the municipal education system. Its appearance is associated with a significant shortage of places in kindergartens for children up to 3 years. Private kindergartens are more flexible and can better respond to the needs of children and their parents, thereby eliminating the problem of preschool education availability. However, their development is hampered by several factors [14]:

• 1.    Absence of a license for educational activity and motivation of most individual entrepreneurs to receive one.

• 2.    Lack of control over unlicensed gardens on the part of authorities and public organizations.

• 3.    Lack of interaction among private kindergartens.

• 4.    High amount of parent fees.

Despite the demand for private institutions, their capacity is not revealed enough today.

Effective development of public-private partnership in this sphere requires, on the one hand, reduced administrative burden on private business in the social sphere [1, 4, 21] and, on the other, strong supervision of the non-state sector of preschool education on the part of regional authorities. It is necessary to define indicative percentage shares of the non-state sector of preschool education in strategic programs, sub-programs of socioeconomic development of territories, and road maps.

The problem to motivate individual entrepreneurs to get a license for supervision and care of children can be solved if the calculation of pensions of non-state organization employees will include pedagogical experience. It possible to back private business in preschool education by creating consulting centers that provide legal services to private entrepreneurs in the sphere of educational activity and considering this sphere during negotiations between the authorities and entrepreneurs, including business rights commissioners (business-ombudsmen).

The implementation of these measures will help rise the share of the non-state sector in preschool education and ensure meeting the targets of the “road map” to improve the efficiency of education.