Exploring the Problems and Directions for Improvement in Local Education Finance

This study aims to provide a comprehensive analysis of the current state of local education finance and to present directions for improvement in response to growing fiscal instability. Despite its critical role in ensuring the quality of local education, local education finance faces multiple challenges, including structural rigidity, inefficiencies in fiscal operations, and institutional instability. In particular, the sharp decline in the school-age population and the imbalance in annual fiscal size due to the linkage with national tax revenues have highlighted the urgent need for reform. Through an in-depth analysis of the current system, this study identifies structural limitations and key issues, and proposes policy directions to ensure a stable and sustainable local education finance system. Key recommendations include reforming the allocation mechanism of education grants to reduce regional disparities in finance and education quality, and establishing a performance-based budgeting and evaluation framework. Given the rapid changes in the fiscal environment, this research is expected to contribute meaningfully to enhancing the stability and efficiency of fiscal management in the education sector.