Setting up an Education business in Singapore
The foundation of Singapore’s modern education system was laid by the country’s first prime minister, Mr. Lee Kuan Yew. As is true in many other fields, his pioneering ideas on education set the template for the country’s education system and the country continues to largely follow the vision that he outlined. Lee Kuan Yew was single-mindedly focussed on improving the standard of living in his country and he viewed education as the key enabler for improving the lives of Singaporeans. Thanks to his vision, the country became one of the world’s top educational centres, in addition to being a great trading and financial hub.
Today, Singapore’s education system is ranked as one of the best in the world. The country ranks second in the latest Programme for International Student Assessment (PISA), a study done every three years by the Organisation for Economic Cooperation and Development (OECD); the triennial study tests 15-year-olds in dozens of countries, in the main three categories of mathematics, reading, and science. Singapore does similarly well on exams given to younger children, and the graduates of its best schools can be found scattered around the world’s finest universities. The country’s two leading universities are now both ranked among the world’s top 15, and the city itself is ranked 15th in the QS Best Student Cities 2018, reflecting Singapore’s combination of educational excellence, high quality of life, and a diverse student community.
The business opportunities that stem from the country’s emergence as a premier educational centre are considered very attractive by many Singapore and international entrepreneurs. More than 1,300 private educational institutions flourish in the city-state, a number that grows every year. The success of this sector is due not only to the well-developed educational ecosystem of the country but also to its clear, transparent, and speedy system for launching educational institutions. This article will provide general guidance for launching, registering and licensing private schools in Singapore.
It includes the following topics:
Why is Singapore a premier education hub?
In addition to Singapore’s achievements in the education sector, the country has many other advantages to become a top draw for students from all over the world. These include:
Safe and Stable Environment. The country has a safe, low-crime environment that contributes to business-related and social activities. Having sound corporate governance and political stability, Singapore is also a model of efficiency. This efficieny, rule-following, and “get it done” attitude spills over to its educational sector as well.
Qualified educational institutes. Singapore has a number of high-quality universities, several of whom are internationally recognized. In addition to the four local top-ranked universities — the National University of Singapore, Nanyang Technological University, Singapore Management University, and Singapore University of Technology and Design — nine leading international institutions have established an Asian campus in Singapore. These include Yale, INSEAD, University of Chicago, UNLV, and NYU’s Tisch School of Arts.
Cost of education. According to a report by Business Standard, education is more affordable in Singapore (approximately 20–25% cheaper) than in the United States and United Kingdom. For example, total fees for a full-time MBA program in Singapore range between S$57,000 and S$60,000. You can expect to pay as much as $100,000 or more for a similar program in the US. Thus, regional students need not go far to obtain high-quality education nor pay through their nose.
Education quality assurance. To protect students, national legislation contained in the Private Education Act obliges most Private Educational Institutions (PEIs) to be registered with the Council for Private Education (CPE). The validity period of an institution’s registration varies based on how well it measures up to CPE’s registration criteria. This encourages educational institutions to improve their standards to attain a longer validity period.
Projections for Singapore’s education sector
The above factors have contributed to a robust and growing education sector in Singapore. Private institutions constitute a large segment of the market. Singapore international schools, for example, draw revenue of about S$1.6 billion and enroll about 53,000 students annually. It is not uncommon to find schools with an enrollment of more than 2,500 students, priced at more than S$25,000 per year. Students from across the world view Singapore as a premier jurisdiction where they can invest in their education and obtain high quality skills that will open new economic opportunities for them. Singapore’s education market is expected to expand, with involvement of international investors who will launch new, innovative high-quality private offerings.
Types of educational institutes
In general, the private educational institutions in Singapore can be divided into three main categories:
Pre-schools are educational establishments or learning spaces offering early childhood education to children before they begin compulsory education at primary school. There are two main types of pre-schools:
- Child Care Centres. Child care centres provide child care services and pre-school developmental programmes for children aged from 18 months to under 7 years old. Some centres also provide infant care programmes for infants aged between 2 and 18 months old. Centres may offer full-day, half-day, and flexible programmes to cater to the different working schedules of parents.
- Kindergartens. Kindergartens provide preschool developmental programmes for children from about 2 years to under 7 years of age. The programme consists of at least Kindergarten 1 and Kindergarten 2. It can further include Playgroup, Pre-Nursery, and Nursery levels. Most kindergarten sessions range between 2 and 3 hours for Playgroup and Pre-Nursery, and between 3 and 4 hours for Nursery, while Kindergarten 2 runs 5 days a week.
An academic school is defined by law as an organisation that provides education for 10 or more persons; or a place where 10 or more persons are being or are habitually taught, whether in one or more classes. Such schools typically provide theoretical, structured and formal education and offer certificates, degrees, and diplomas. Some examples are:
- Educational institutes that provide academic classes leading to the GCE examinations;
- Business schools;
- Language institutes;
- Tuition or exam-preparatory institutes;
- Centres for adult education;
- IT or computer education institutes;
- Fine arts schools;
- Enrichment centres, which give diplomas or conduct certificate courses, etc; and
- Distance learning centres.
This category covers facilities or establishments offering instruction of a non-academic nature; they focus on practical exposure, hands-on learning or experiences — such as brain or memory training, beauty care, dressmaking, cooking, sports, games, driving, recreation-related services, etc. Some examples of non-academic schools are:
- Cookery schools;
- Pet grooming classes;
- Driving schools;
- Hair styling institutes;
- Dressmaking classes or institutes; and
- Sports institutes.
Setting up a private school in Singapore
1. Learn more about the private school business
When you’ve decided to establish a private school, visit a few educational institutions and do an initial cost estimate to assess the viability of your business. Study the market to understand whether your target market has a sufficient number of interested students. Consider the rental opportunities and operational costs in each potential location. Calculate staff requirements and start researching their availability and salary range. When you feel satisfied with your business plan estimates, you are ready to go to next steps. The procedure below describes the most comprehensive variant — setting up an academic private school. Establishing a non-academic school is generally easier and does not require obtaining a Ministry of Education license, establishing a Committee of Management, etc.
2. Complete the pre-registration steps
Choose a name for the school
A school name must denote a place of learning. The name proposed ought to reflect the curriculum and the type of courses that will be offered by the school (for example, a language school named “ABC Language School”).
Words such as “Singapore” or “National” connote ownership and links with the Government. Hence, private schools should not be named in such a manner as, for example, “Singapore ABC School” or “National ABC School”.
If the school is registered as a sole proprietorship or partnership business with the Accounting & Corporate Regulatory Authority (ACRA), the name of the school and the corresponding business must be identical.
The Ministry of Education (MOE) has the right to refuse registration of any name proposed for a school that it deems to be unsuitable or misleading. So, for clarification on a proposed school name, you are advised to consult the Private Schools Section (PSS) of MOE prior to registration with ACRA.
Be Cognizant of curriculum restrictions
There are certain restrictions on the type of curriculum a private school may adopt. For instance, private schools are not permitted to operate or function as full-fledged alternative primary or alternative secondary schools.
University education requires extensive resources beyond the ability of private schools to provide. Private schools are thus not considered equivalent to a university and are not to function as institutions of higher education operating as a university. Hence the word “University” is not to be used by private schools in the proposed school name.
Committee of Management members
Every academic private school must be administered by a Committee of Management comprising a minimum of one and a maximum of 9 members. The Committee is responsible for ensuring that the provisions of the Education Act and the terms of the school constitution are complied with.
Members of a Committee of Management should not be teachers or staff employed by the school, unless they are also the owners of the school. This is to prevent employer-employee conflict-of-interest in decision-making.
One member of the Committee of Management of a school must serve as the Supervisor of the school. If a school has only one member in its Committee of Management, that person must also act as the Supervisor.
Adopt a school constitution
A private school must submit a constitution when applying for registration with the authorities.
At least two teachers are required for each private school. The application for each teacher’s permission to teach in the relevant school must demonstrate the minimum educational qualifications and relevant working and teaching experience required for the school. When applying for registration, the supervisor must clearly specify the modules, courses, or subjects, and their levels that the teacher is proposed to teach.
Acquire premises and facilities
Be careful when selecting and deciding on premises to house the school. Before you enter into any firm commitment to purchase or rent the premises, look out for the prospects of the premises being granted Written Permission for “Change of Use” by the planning authorities (Urban Redevelopment Authority), and that any alterations or renovations planned for the school site are likely to be approved or cleared by the relevant authorities (such as the Housing & Development Board).
Private schools ought to have premises of an acceptable and reasonable size. In addition to classrooms, they should have space for an office, administration area, reception-cum-waiting area for students or clients, etc.
3. Register your educational institution
Once you have completed the groundwork, you should register your school with the Singapore Accounting and Corporate Regulatory Authority.
The most suitable legal entity is to register a private limited company.
4. Prepare for the license application
Prepare the relevant application forms for the Committee of Management, Course Registration, and Registration as a Teacher, as well as clearances from relevant authorities and other necessary documents as mentioned in step 6 below.
5. Apply for the Ministry of Education license
File the relevant online application form through the LicenceOne system.
6. Submit necessary documents
After filing an online application through LicenceOne, you are required to submit the following documents via courier delivery or postal mail to the Private Schools Section of the Ministry of Education:
- Floor plan as approved by the Fire Safety and Shelter Department;
- Fire Safety Certificate;
- Grant of Written Permission from the Urban Redevelopment Authority;
- Latest ACRA BIZFILE printout;
- Committee of Management Forms;
- Appointment Note (for sole-proprietorship, partnership, and LLP) or Directors’ Resolution (for private limited company) to appoint the members of the Committee of Management;
- Course Registration (Summary of Course Particulars) forms;
- Course Write-up;
- Teacher Registration forms;
- School Constitution; and
- Memorandum and Articles of Association of Private Limited Company (required only for companies).
7. Pass inspection of the school
Once all submitted documents are found to be in order, the ministry officer will arrange for an inspection of the premises of the school.
8. Obtain the certificates
A complete application, with all necessary documents, is usually processed within 14 working days from the date of receipt by the ministry. Incomplete or incorrect submissions result in delays in processing.
Upon approval of registration and the successful completion of all necessary administrative procedures (including payment of registration fees to LicenceOne), you will receive the School Registration Certificate, Classroom Accommodation Certificate(s), and all other necessary documents. Renewal of the School Registration Certificate is not required, as there is no expiry date. However, a new application through LicenceOne is needed if a branch or a new centre is to be established.
After obtaining the School Registration Certificate, your school may start its operations!
Additional regulatory requirements
Note that certain educational institutions face additional requirements because of the nature of the services they provide.
For example, all academic private schools that fall under the following categories are required to register with the Council for Private Education under the Private Education Act:
- Schools offering education leading to the award of a diploma or degree, or full-time post-secondary education leading to the award of a certificate;
- Schools offering full-time preparatory courses for entrance or placement tests for joining Ministry of Education mainstream schools, or for external examinations;
- Foreign System Schools offering full-time primary or secondary education wholly or substantially in accordance with a foreign or international curriculum;
- Privately-funded special education schools.
The procedure for setting up pre-schools is also slightly different. Applications for licensing new child care centers and kindergartens are submitted via the GoBusiness Licensing portal. These centers have to obtain a license issued by the Early Childhood Development Agency (ECDA). Such institutions may have additional requirements for their activities that also should be approved by the ECDA, etc.
After your school starts operating, you should obtain accreditations to gain credibility and trust with your future students.
- EduTrust certification is needed for enrolment of any international students. Private education institutes and schools could get financial support for EduTrust certification under the EduTrust Support Scheme. This project allows all eligible educational institutes that want to upgrade their capabilities to receive a grant of up to S$26,500.
- Singapore Quality Class (SQC) certification builds positive perceptions about your institute and helps to expedite management of student visa applications that are submitted by SQC-certified educational establishments.
Singapore companies enjoy numerous business assistance schemes and tax incentives created to support business-incubating infrastructure and to propel the nation towards a thriving start-up ecosystem. Some of these schemes were created to support specific industry verticals, including the education sector. One such incentive is the Venture ForGood (VFG) grant.
The Venture ForGood (VFG) grant is a funding scheme under the Singapore Centre for Social Enterprise (raiSE) meant to support social enterprises at various stages of their business. New and existing social enterprises that are starting up or expanding operations can apply for up to S$300,000 in grants. The scheme is available for businesses engaged in the provision of services in areas of education, skills development, basic human needs, economic tools and services, and health or social care.The raiSE Grant is open to all new and existing locally-based social enterprises that are registered or intend to register under the Companies Act or Co-operative Societies Act. The company should be incorporated and be registered as a raiSE member at the point of grant disbursement. To learn more and to apply for the VentureForGood fund, please visit the raISE’s website.
If you plan to set up a private educational institution in Singapore, in most cases your business is required to apply for various relevant certificates. The procedure for obtaining the licenses and certificates is transparent, clear, and fast, although it requires you to meet certain minimum quality conditions due to the nature of the business and the high degree of responsibility it demands.
Before applying, you must ensure that your venture is registered with ACRA, has the necessary premises, employs professional teachers, and hires key executives of good character . Once all of the requirements have been met, you can submit an application to the Ministry of Education or the other relevant authority. In most cases, you will get your license within 2 weeks and can then start your educational institute activity.
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