Schools need to systematically monitor their cash flow and maintain close relationships with families. These were the two main recommendations made by Bernardo Rangel, an economist and the chief financial officer of Educbank, who attended the special Sieeesp meeting with the operators of São Paulo’s private schools at the Bett Brasil 2023 Conference.

The meeting was moderated by Marcos Valverde, first vice president of Sieeesp, who, in his presentation, addressed topics such as the average rate of delinquency among schools in the state, the issue of autism, and the negative impacts of the tax reform, which—if Constitutional Amendment Proposals (PECs) 45 and 110 are adopted—could raise the tax rate on schools to as high as 21.5 percent.

According to Rangel, “the economy has been impacted by the fiscal imbalance; the pandemic, the war in Ukraine, inflation, and high interest rates are the main factors in recent years that have caused financial strain across the country.”

He also emphasized that the economic crisis is structural and global, and it is uncertain how long it will last. "One of the factors that could help Brazil recover more quickly is commodity exports and controlled inflation."

For the elementary education sector, the main implications of this economic situation are:

1. Pressure on household income;
2. Less room to pass on inflation
3. Higher delinquency rates

And to respond to this situation, we need a clear understanding of the market, to strengthen our relationships with families, and to improve our cash flow planning.

Due to the severe rain and traffic problems that affected the city of São Paulo, the meeting with the schools will be made available on the Sieeesp YouTube channel.

Article originally published on the SIEEESP website.

Text and photo by Juan Alejandro.

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