The World Bank is promoting education vouchers as a way of providing schooling for poor children who would otherwise receive none.

The bank - which lends money to developing countries - is supporting a scheme giving coupons to parents in Colombia, South America, which they can use for private schools. It aims to create 546,000 new places and to raise secondary enrolment from 46 to 70 per cent.

It is just one of a number of initiatives involving the private sector described in a new World Bank pamphlet, Private and Public Initiatives, and it illustrates the extent to which organisations like the bank believe in using the private sector to provide essential services.

“After more than half a century of experiments with alternative forms of economic development, the evidence strongly favours the proposition that competitive markets are the best and most efficient way to organise the production and distribution of goods and services,” says the pamphlet.

Colombia’s cities are surrounded by poor, densely packed neighbourhoods that lack the most essential services. Less than half the country’s children receive secondary schooling, partly as a result of Colombia’s meagre investment in education.

Colombia launched the voucher scheme with World Bank money in 1991 in an attempt to overcome this. The vouchers are paid for jointly by central and municipal government and fund places at private schools. At the same time, the government offered incentives encouraging commercial lenders to loan money to private schools.

Under the voucher programme, municipalities decide on the number of vouchers they need and can afford to sponsor. They choose the private schools that will take part, only selecting those with examination results equal to or better than in maintained schools.

The scheme has started on a small scale, involving 87 schools. The vouchers go to poor children under the age of 15. In 1993, the average cost of a voucher to the government was US$143 (Pounds 100).

Various problems have surfaced, including municipalities which fail to accept their share of funding. In some cases, families have used vouchers to shift their children from one school to another - which means overall enrolment has not increased. The World Bank recommends better targeting of pupils.

Has the scheme worked? Colombia will have a better idea after it has conducted an experiment. It is looking at two sample populations, one that received vouchers and one that did not.

It will study comparative test scores, attendance, delinquency, staying-on rates and employment after leaving school. “When the results are in, policy-makers around the world should be able to draw valuable lessons, ” says the bank.

Pakistan provides another example of the private sector helping the poor. It has a primary education programme, supported by World Bank money, that has established much-needed girls’ schools in poor villages and city slums.

The programme was set up in Baluchistan, one of Pakistan’s poorest provinces, in which only 15 per cent of girls attend primary school. Money to build the schools and pay the teachers comes from the national government. But the job of overseeing the running of schools goes to village education committees, made up of parents and community leaders.

In three years, 198 new schools have been set up by village committees and 8,420 girls are now in school. Another 43 schools which had been closed for lack of women teachers have been opened.

The World Bank believes a market-orientated approach to development can bring spectacular results. Governments all over the world are redefining their roles, it says. Once owners of state enterprises and producers of services, they now seek to let private enterprise flourish.

However, there was criticism from Keith Watson, professor of education at Reading University. He claimed that the bank was going overboard on the private sector in general and vouchers in particular.

Vouchers might be a legitimate idea applied to Latin America and some East Asian countries where the private sector was quite strong, but not in Africa where the private sector was weak, he said.

Moreover it would take time to judge whether the Colombian experiment was working and whether it was something that the bank should push elsewhere.

Another critic, Professor Christopher Colclough, of the Institute of Development Studies at Sussex University, said the Colombian voucher initiative was “very interesting” and had “some merit” in the context of a country with a well-developed private sector.

“It may be more efficient for the government to give vouchers to help strengthen that system,” he said. “It may not be inequitable to do so if they do it on a per capita school basis.”

An economics professor, Colclough is co-author of a book Educating All the Children. He is generally critical of the World Bank’s emphasis on the private sector and market-places.