Creation of Fiscal Space for Sustainability of Private Second Cycle Institutions: The Role of Income Diversification

Abstract

Private schools around the world continue to face sustainability challenges due to limitations in fiscal space as they strive to provide top notch academic services to their customers. Some educational experts have predicted the closure of many private schools in the last few years as a result of low financial stability indicators of these academic institutions. From this state of affairs, this study sort to examine the role of income diversification in the creation of fiscal space for academic sustainability of private second cycle educational institutions. A quantitative research approach was adopted. The study made use of descriptive correlational design. Descriptive statistics based on the central tendency with SPSS and regression process by Hayes model 1 were used to analyze and interpret the data collected from 190 private second cycle educational institutions in Ghana, randomly selected out of the population of 315, to answer self-constructed questionnaire. Results showed that private second cycle educational institutions have very low levels of income diversification activities to create fiscal space. There was a positive, significant influence of creation of fiscal space on financial sustainability. The findings have implications for income diversification strategies which create fiscal space and harness institutional income levels for academic and/or financial sustainability.