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November 15, 2010

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Home » Metro » Education

Draft calls for private schools to set up fund

OFFICIALS have drafted a proposal requiring private schools and training centers to set aside money for student refunds in case they shut down.

The regulation is expected to take effect next year.

Fu Lujian, an official with the Shanghai Academy of Educational Sciences, said the proposal can protect students from financial loss and that it wouldn't be difficult for a private school to set up such a fund.

Private education does not have a long history in the country and it lacks a good supervision system, Fu said.

"The draft helps build a better system," Fu said.

There have been several cases where students encountered trouble getting refunds when a school closed.

Last December, the five branches of Kaien English Training Center, one of the biggest foreign language institutes in the city, closed suddenly due to financial problems.

The closure left hundreds of students, who prepaid for their courses, worried about their money. Also, some of Kaien's teachers were not paid.

Kaien's Irish founders, Brian McCloskey and Ken Carroll, disappeared about the same time the institute closed.

Kaien's Chinese partner reopened two branches about two months later, allowing students who had prepaid to finish their courses.

The students also had the option to get a refund.

Yang Yuemin, an official with the Shanghai Education Commission, said if such situations occur in the future, the fund, instead of the local government, will provide refunds and ensure teachers are paid.

At the moment, government departments usually help cover refunds.

Yang said the draft is designed to protect students from tuition scams.

Fu said details, such as how much money has to be set aside, have yet to be worked out and that the draft also includes criteria for running a private school.

By November 25, individuals can express their ideas and concerns about the draft by e-mailing to


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