Education officials explain high school fees in Dubai



DUBAI // New schools are forbidden from increasing their fees during the first three years of operation – or longer, if they fail inspections – leading to higher rates from the start.

“When you price a school opening in Dubai, you are pricing yourself sort of ahead of the market,” said Daniel Lewis, principal of North London Collegiate School Dubai, which will charge some of the highest fees in the country when it opens to students in September.

The fees at NLCS Dubai, excluding transportation and uniforms, will range from Dh83,000 for pupils in pre-kindergarten to Dh130,000 for pupils in Grade 12.

But the premium private school is not isolated in charging these high-end prices. Two of the schools Bloom Education will open for the 2018-2019 academic year – Brighton College Dubai and Dwight School – also carry fees between Dh107,000 an Dh130,000 for final year pupils, respectively.

“One has to look of course, how much does the school cost to build – the land and location and so on and so forth,” said Henning Fries, chief executive of Bloom Education.

“Then we are also looking at, most importantly, the operating expenses. We deal with excellent ratios of teacher-students. In terms of our selection, the types of teachers that we attract have top international experience. That is really where most of the expenses sit in the school.”

Bassam Abushakra, regional director for Esol Education, which operates American private schools in the Middle East and Asia, said staff salaries account for most of the cost.

“Almost 70 per cent of the fees goes toward staff salaries, and recruiting internationally, especially for American schools, the supply of teachers is not that high, so you’ve got to be paying competitive salaries,” said Mr Abushakra.

The high cost of living in the UAE also plays a factor, he said.

“There is no income tax here, but the cost of living in Dubai is not cheap and campuses are all state of the art, so they cost a lot,” said Mr Abushakra. “I’ve never seen a city with so many beautiful campuses and then the staffing ratios tend to be generous.”

He predicted that reported cutbacks to education allowances would not have a significant impact on the business, although he estimated that 25 to 30 per cent of pupils’ tuition fees are paid directly by their parents’ employer.

In recent years, a growing number of private schools in Dubai have been charging tuition fees near or in excess of Dh100,000 annually.

Of the 124 schools that qualified to increase their fees, 10 are charging tuition higher than Dh90,000 for the final grades, for example.

These include Foremarke School, Gems Wellington Academy – Al Khail, Gems Wellington International School, Gems World Academy, Horizon International School, Kings School Al Barsha, Regent International Private School, Repton School, Swiss International Scientific School and Sunmarke School Dubai, according to data compiled by WhichSchoolAdvisor.

Mr Abushakra said he does not believe there is “that much demand” for Dh100,000-plus schools.

The tuition for Esol’s newest American school has yet to be finalised, but it will likely be around Dh75,000.

He also acknowledged that companies in expat markets are cutting benefits like education.

“We see it in Hong Kong, we see it everywhere,” he said.

A majority of pupils enroled in Dubai private schools, 57.5 per cent, attend schools that cost Dh20,000 or less in annual tuition fees, according to the Knowledge and Human Development Authority.

rpennington@thenational.ae

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

Key figures in the life of the fort

Sheikh Dhiyab bin Isa (ruled 1761-1793) Built Qasr Al Hosn as a watchtower to guard over the only freshwater well on Abu Dhabi island.

Sheikh Shakhbut bin Dhiyab (ruled 1793-1816) Expanded the tower into a small fort and transferred his ruling place of residence from Liwa Oasis to the fort on the island.

Sheikh Tahnoon bin Shakhbut (ruled 1818-1833) Expanded Qasr Al Hosn further as Abu Dhabi grew from a small village of palm huts to a town of more than 5,000 inhabitants.

Sheikh Khalifa bin Shakhbut (ruled 1833-1845) Repaired and fortified the fort.

Sheikh Saeed bin Tahnoon (ruled 1845-1855) Turned Qasr Al Hosn into a strong two-storied structure.

Sheikh Zayed bin Khalifa (ruled 1855-1909) Expanded Qasr Al Hosn further to reflect the emirate's increasing prominence.

Sheikh Shakhbut bin Sultan (ruled 1928-1966) Renovated and enlarged Qasr Al Hosn, adding a decorative arch and two new villas.

Sheikh Zayed bin Sultan (ruled 1966-2004) Moved the royal residence to Al Manhal palace and kept his diwan at Qasr Al Hosn.

Sources: Jayanti Maitra, www.adach.ae

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5pm: Maiden (PA) | Dh80,000 | 1,600m
5.30pm: Maiden (PA) | ​​​​​​​Dh80,000 | 1,400m
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Install an air filter in your home.

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UK's plans to cut net migration

Under the UK government’s proposals, migrants will have to spend 10 years in the UK before being able to apply for citizenship.

Skilled worker visas will require a university degree, and there will be tighter restrictions on recruitment for jobs with skills shortages.

But what are described as "high-contributing" individuals such as doctors and nurses could be fast-tracked through the system.

Language requirements will be increased for all immigration routes to ensure a higher level of English.

Rules will also be laid out for adult dependants, meaning they will have to demonstrate a basic understanding of the language.

The plans also call for stricter tests for colleges and universities offering places to foreign students and a reduction in the time graduates can remain in the UK after their studies from two years to 18 months.