Financing - Iceland

Pre-school education

Pre-school is financed by the municipalities but they may determine fee collection for a child’s pre-school attendance, but the fee collected for each child may not exceed the average real cost incurred by each child’s attendance in pre-schools operated by the municipality. There are no separate funds for special education.

Compulsory education

Compulsory schooling, including books, course supplies and study trips, is free of charge. Funds are provided by central government to municipalities to meet the needs of handicapped pupils within compulsory school age. The following two conditions apply to payments to the municipalities:

• that the pupil in question is a legal resident of the municipality and his/her handicaps have been diagnosed;
• that, when the handicap falls within the frame of reference of the Municipalities Equalisation Fund, there is a need for special assistance.

Payments to the municipalities for handicapped pupils depend on levels of disability. The same amount is expected to be paid per pupil with the same degree of disability irrespective of whether the special education provided varies from one municipality to another.

The Advisory Committee of the Municipalities Equalisation Fund has set the working rules for deciding the degree of disability in accordance with its type. The type of disability that falls below a defined level should rely on special assistance in the form of a payment to the local authority. The amount allocated to local authorities from the Equalisation Fund for each individual pupil is meant to provide an educational opportunity for the individual pupil. This amount differs according to medical diagnoses and is in accordance with the amount the individual and his/her family gets from the national security system because of a given disability as described in the Act on the Affairs of the Handicapped from 1992. The State Diagnostic Centre has the final say in whether the amount suggested by other specialists is in accordance with the given handicap.

When the local authorities make their annual budget they set aside an amount to finance special educational provisions within the municipality. The local authorities can either provide an educational opportunity in the pupil's school or use the money to buy services in another school in the local community or in another community. This could include a special class or a special school. Communities can share the running of a special class or a special school and to do so local authorities set aside extra money.
The time allocated to special needs education for each local authority is calculated as follows: a minimum of 0.25 teaching hours per pupil for the first 1,700 pupils in the community and 0.23 teaching hour per pupil after that. This amount is to finance SEN within mainstream classes or in special classes.

In each community the local authority, with the help of head teachers, specialist services, school doctor and other relevant parties assess whether there are pupils in the community who, because of handicap or for other reasons, are in need of special education. Within each school the head teacher in co-operation with the class teachers evaluate whether there are pupils who need special education. The head teacher submits his special educational plan to the local authority. After the local authority has allocated the amount to be used for special education, each school makes an education plan for an individual, a group or a special class. The plan includes teaching, materials and assistants.

Upper secondary school

The state treasury pays upper secondary school operating costs. In the upper secondary schools pupils do not have to pay school fees but they do pay for course supplies and a part of the cost of materials.
Funds for educating pupils in need of special support are applied for to the Ministry of Education on an individual and/or group basis.

Higher education

Funding for supporting students with special needs at university level is provided on an individual basis by the universities themselves from their total budget. There has been a huge increase in the number of students needing special support at university level over the last years.