The following is the full text of a speech given by Kevin Comeau to the Hamilton Rotary Club yesterday.

In May, 2007 the Minister of Education released of summary of the Hopkins Report, a comprehensive review of Bermuda's education system. The Report contained a hard-hitting condemnation of both the Bermuda public school system and the Ministry of Education, and recommended sweeping changes for improvement. These changes are both significant and important. They include dramatically improving the quality of teaching, standardising the curriculum, conducting annual school reviews and implementing authentic testing. These changes should significantly improve the educational product being delivered to students, but will these changes dramatically improve the performance and graduation rate of students? Probably not – because the problem has two key parts and only one is being addressed.

Businessmen the world over know the importance of not only building a better product (supply-side improvements) but also increasing demand so that consumers will spend more money buying that product. The same is true with education, but since public education itself is free to the consumer, demand-side education reforms do not try to encourage parents and students to spend more money on education; they encourage parents and students to spend more time on education.

How do we go about this?

First, we have to recognise who it is that we wish to spend more time on education. My reference to both parents and students was deliberate because both are key players in demand-side education reform.

Study after study has shown that it is not income or social status, but active parental involvement in a child's education that is the most accurate predictor of a student's achievement in school-attending school regularly, earning higher grades, passing their classes, graduating high school and going on to obtain a postsecondary education. I've yet to meet a teacher that didn't wholeheartedly agree with this statement. Children will perform significantly better when their parents are actively involved in their education. So what can be done to encourage parents to do more?

There are three fundamental steps that should be taken:

1. Tell parents the fundamental importance of their participation-get the message out;

2. Give parents the tools they need to help their children derive more from the education product being delivered by the schools; and

3. Give parents and students incentives to work harder and smarter.

Let's look at these three fundamental steps more closely.

1. Getting the Message Out

Many parents, both rich and poor, still believe that teachers are solely responsible for their children's education. They believe that their own responsibility entails little more than delivering the child to and from school. The Bermuda government can help change these beliefs by using the media and advertising to deliver the message of the fundamental role parents play in their children's education successes. Over and over again, the message should be repeated: it is not income or social status, but active parental involvement in a child's education that is the most accurate predictor of a student's achievement in school.

This message can't get to parents soon enough. Since many child-development experts believe that the parent's role in a child's education begins at birth, the government should think of ways to get the message to parents long before the child begins school. (For example, at present, the maternity ward at the King Edward Hospital gives new parents a brochure listing things the parent should do for the child. Why not include a page informing parents when they should start speaking and reading to their child, as well as advising parents of the need to read to their child every single day.)

2. Giving Parents the Tools They Need

Parents must also be given a structure through which they can more actively participate in their child's formal education. A core component of that structure should be an information system through which parents can access the subject matter being taught to their children in school each and every day so that they can review that material with their children at home. At present, even parents who wish to stay involved in their children's education are critically handicapped in that effort because they have no way of knowing what their children learn in school each day. The child comes home from school, the parent asks the child what he or she learned in school that day, and the child shrugs, "I don't know."

If the government really wants parents to become meaningfully involved in their children's education, it should require teachers to post on the web every single day both the homework assignment and the teacher's daily lesson plan so that parents can review with their children what they learned in school that day. Learning is relearning, particularly in the first three years of school when rote is the primary method of teaching. For parents who do not have web access, a paper copy of the lesson plan can be sent home with the child. Now when parents ask their children what they learned in school that day, the conversation won't end with a shrug, it will begin with a click.

3. Incentives to Work Harder and Smarter

In some cases this information flow-first telling parents of the importance of their active involvement and then giving them the daily information they need to stay involved-will be enough to encourage parents to fully embrace an active role, but in many other instances, it will not be enough for a myriad of reasons, not the least of which is the lack of free time parents have to give their children because they are working two and three jobs just to meet the basic economic needs of the family. This problem is further exasperated where the parents have not had much educational success themselves, and they have already projected the same for their children. It is these parents and their children that are best targeted by demand-side education reforms-economic incentives tied to performance.

Over the last decade, innovative demand-side education reforms have been implemented around the world with extremely positive results. From Brazil to Mozambique to Jamaica, economic incentives have dramatically improved learning and reduced dropout rates. In Kenya, where the top 20% of students and their families were awarded both cash and payment of the next two years' school fees, large gains in test scores were achieved across all academic subjects and at all levels of initial academic performance-even the worst students performed better. "Two new studies from Israel and the United Kingdom find similar results from student incentive programs. An incentive program in poor Israeli high schools-providing cash awards to adolescents who pass their national high school exams-also led to large improvements in test scores."

In support of further demand-side education reforms, the World Bank has begun funding numerous conditional cash transfer programs around the world-paying parents to get more involved in their children's education by keeping their children in school and helping them make the right education decisions.

So what can we do in Bermuda? How do we use the concepts of conditional cash transfers and other demand-side education reforms in a highly affluent country where less than 50% of students complete high school?

I'm now going to discuss the core part of my speech:

A Proposed Incentive-Based Scholarship Programme

To motivate parents to become and remain actively involved in their children's education and to motivate children to work harder and smarter at getting more out of the education product being delivered to them, I recommend that the government, in partnership with the business community, implement a scholarship program for every Bermudian child in public school beginning in Primary One right through to completion of Senior School.

Under the scholarship program, every child who successfully completes their homework more than 90 percent of the time over the course of the full school year would receive $500, and would receive an additional $250 if he or she attained an overall B average or an additional $500 if he or she attained an overall A average. The money would be held in trust and only vest if the child graduates from high school and the proceeds would only be paid directly to a post-secondary institution (including trade schools) to pay for the child's tuition and other education-related expenses. Until vesting and payout, the money held in trust would be invested in the shares of public companies and government securities.

As you can see, I've taken the traditional structure of scholarships-granting awards in the final year of high school-and turned it on its head.

There are numerous reasons for this. Here are three:.

1. Timing and Efficiency

Typically, awards of academic scholarship are based on the performance of the student in his or her last year of public school. As a means of effective motivation, this has to be wrong. By the time a student reaches his final senior year it is too late to begin teaching him the necessary skills-discipline, hard work, delayed gratification, a love for reading and learning-which are needed to get the most out of the educational product being delivered to him. As an incentive, scholarship programs would be much more effective if they began the first day the child enters the public school system rather than at the end of his or her final year of school. This is particularly true in light of the view of many educators that the first several years of school are the most important.

I'm now going to read you a quote based on a report from the US National Center on Education, Disability and Juvenile Justice. When I first read it, I could literally feel my jaw dropping.

Third grade is a turning point when children shift from learning to read to reading to learn. Children who can't read and do basic math well by then are unlikely ever to catch up. Indeed, proficiency by third grade is so critical that at least four states [in America] are known to use third-grade test scores to predict how many prison beds they'll need years later.

This is a startling statement for two reasons:

(i) it tells us that education is a concern for the entire community – even if you don't have children, you will be adversely affected in the future through higher social costs, particularly increased crime, if today's education system does not more effectively help as many children as possible; and

(ii) it tells us that it may be too late to wait until the later years to get the required help for children. Doesn't it make more sense to begin giving children the most effective help as early as possible? And since we know that parental involvement is the primary determinant in a child's educational success, doesn't it make sense to do everything we can to motivate parents to become actively involved as early as possible?

2. Motivating Parents

Financial awards for very young children are not intended to directly motivate the child; they are intended to motivate the parent. Very young children do not understand the concept of money and so offering them an annual $1,000 scholarship has no more meaning than offering them a dollar. But parents, regardless of their own educational success, know the value of money; they know that $1,000 every year invested and compounded over twelve years can amount to a very large sum, every dollar of which reduces the amount of money the parent will have to pay for the child's post-secondary education. In effect, the scholarship program is an education savings plan in which parents contribute time as opposed to money.

But the motivation from a scholarship program goes much further. Even where the parent is financially secure, the parent's love for the child will motivate the parent to help the child earn the scholarship award, thereby instilling in the child a sense of self worth from achievement.

So where does the motivation for the young child come from? Two sources: the first is from the parent's mere involvement – if the parent is interested in the child's education, the child is more likely to be interested-and the second is from various child-specific methods of motivation individualized by the parent to the child at each stage of development.

The government can also help in this regard. Teachers and child psychologists have a wealth of knowledge of ways to effectively motivate children at different stages of the child's development. The government should post a website setting out a list of these methods (simple games to play, books to read, etc.) for parents to motivate their children at each stage of development. As the child gets older and learns the value of money, the scholarship awards will themselves become an additional source of motivation for the child, augmenting other means of motivation continually developed specifically for each child by parents and teachers.

3. Learning the Rewards of Hard Work and Delayed Gratification

One of the most common criticisms of Bermudian workers is that their work ethic is not as strong as it could be. This is a common criticism of members of affluent societies; material things come to them too easily and so they never develop the competitive drive and motivation that promotes hard work and delayed gratification. A national scholarship programme that rewards students for consistently doing homework and attaining good grades, particularly a program that begins the first day the child begins school and only pays out upon completion of high school and enrolment in a post secondary school, would be a positive first step in instilling those personal values that are associated with education and career success and are the antithesis of those vices that are related to instant gratification, such as drug use and crime.

Funding the Proposed Scholarship Programme: Partial funding for the proposed scholarship program is already built into the system. At present, the Bermuda government provides millions of dollars in scholarship grants, bursaries and loans. What this proposed programme does is take the promise of that funding, which typically only provides an incentive to children in their last year of high school, and leverages that promise so that it motivates children (either directly or through their parents) every single year they attend school.

However, more funding will be needed if the program achieves its objective of substantially increasing the number of students doing their homework, getting good grades and getting a post-secondary education. This, of course, is exactly the problem Bermuda wants-to need more money for scholarships because more Bermudian children are completing high school and obtaining a post-secondary education. Indeed, one of the most appealing attributes of the proposed scholarship program is its economic efficiency: it only costs the Bermuda government money if the program is a success.

While the additional funding needed for the proposed scholarship program could simply come out of the government's coffers, this runs the risk of diverting funds from other government programs, including those presently underway to implement the educational reforms recommended in the Hopkins Report. Additionally, while the international business community has a long history of donating to worthwhile causes, it too has many competing demands for charitable donations.

As fortune would have it, a solution to a completely separate problem in the Bermuda community can provide enough funding not only for the scholarship program but also for the cost of implementing many of the recent election promises of the PLP government.

That brings me to the final part of my discusThat brings me to the final part of my discussion, which is:

Solving the Term Limit/Key Employee Policy Problem

For more than a year, the business community and the government have been unable to negotiate a satisfactory amendment to the term limit/key employee policy so that the government can control the number of long-term residents and local and international companies can control which employees stay or go. During my years as a corporate securities lawyer I was involved in numerous negotiations, and I can tell you that the most important requirement in reaching an agreement is that each side recognize and be able to satisfy the other side's fundamental needs. Although I am not privy to the discussions between these two parties, I suspect that the failure to reach a satisfactory conclusion stems from one or both of the parties failing to meet the other's fundamental needs.

So let's look at those needs. First, the government's needs:

The PLP government has implemented the term limit/key employee policy to satisfy two fundamental needs: one is ecological and the other political. Ecologically, this country, as one of the most densely-populated countries in the world, must control the number of persons living here. To argue, as some have, that "expelling one experienced six-year employee in exchange for a new inexperienced employee does not reduce the number of total residents" misses the point. Long-term foreign workers who (along with their children) gain the right to permanent residency/citizenship will have the right to live here long after they have retired and additional foreign workers have replaced them, thereby increasing the total number of residents, which places a further burden on Bermuda's already strained infrastructure. No matter how liberally one may wish to draw the line-80,000, 90,000, 100,000 people-there is a point at which controls must be placed on population growth.

The second fundamental need is political. The PLP cannot afford to let the number of long-term residents grow because most of these residents are white and relatively wealthy, which, based on past trends, suggests they are unlikely to vote PLP if they ever get the vote (whether as a result of independence or the UBP regaining power).

These two fundamental needs of the present government-one ecological, the other political-are never, ever, going to go away, and until the business community recognizes this fact and finds an innovative way to meet these needs while satisfying their own, the term limit/key employee problem will remain with us.

Conversely, the Bermuda government must recognise how harmful the present term limit policy is not only to local and international businesses, but to Bermudians themselves. Time does not permit me to address each of the many problems this policy imposes on the business community, so I will focus on just one-middle management.

Under the present policy, middle management will never fall under the definition of a key employee, yet it is exactly from this pool of employees that a company's future CEO, CFO and other top officers are likely to be found, and the company will only be in a position to decide which of its managers have the necessary attributes to fill those rolls after it has observed those employees for much longer than six years. Companies cannot afford to simply stand by and let the government's policy decimate their middle management and thereby severely impair their ability to conduct succession planning and implement long-term strategies to maximize profits and minimize risk. International companies will have little choice but to move some or all of their middle management operations out of Bermuda, which will decrease entry level positions for Bermudians, the very people the government is trying to protect. In other words, the present policy is bad for business and it's bad for Bermudian workers.

So what is the answer? It's quite simple.

The government should replace the term limit/key employee policy with a policy that simply substantially increases the fee for work permits for persons who have been resident in Bermuda for more than six years. The present annual fee for a work permit is $616. The government should raise this fee for foreign workers who have been resident in Bermuda for more than six years to say, $4,000 and raise it by another $500 each year thereafter. For local companies that cannot afford these higher costs, the government should exempt them from these higher fees on the condition that they implement a company plan to control the number of their long-term foreign workers.

What is the effect of this? The government controls the number of long-term foreign workers, companies retain control over which workers get to stay or go, and the government has significantly more revenue, enough to not only fully fund the proposed scholarship program, but also to help pay for the many new programs promised in their recent election campaign. By recognizing the fundamental needs of all parties concerned, everybody wins-the government, local and international businesses, and most of all, our children.

So let's sum up what I have said today:

1. The recommendations of the Hopkins Report are important and significant and will go a long way in improving the education product being delivered, but improving the product is only half the equation.

2. Study after study has shown that it is not income or social status, but active parental involvement in a child's education that is the most accurate predictor of a student's achievement in school.

3.I am recommending three steps to increase parental involvement:

¦ Get the message out-tell parents why their active participation is vitally important;

¦ Give parents the tools they need to stay actively involved, including posting the daily lesson plan on the web each day so that parents can review the day's lesson with their children; and

¦ Motivate parents and students by implementing a national scholarship program for every Bermudian child in public school from Primary 1 to completion of high school.

If you think that you have heard some good ideas today that are worth pursuing-that they can help better educate our children – please tell your MP, your teachers and principals, the members of the Hopkins panel implementing the reforms, or simply give me a call at 232-6640 or send me an e-mail at kevincomeau@northrock.bm

Thank you very much. If there are any questions, I'd be happy to take them.

Kevin Comeau, a Canadian, has resided in Bermuda since 1989. He worked as a corporate lawyer in Bermuda for ten years before retiring in 1999.