Charitable giving comes under pressure as donors slash education aid 

Children in Africa will be among the hardest hit by cuts to education funding, says UNICEF. In Ivory Coast, the Jacobs Foundation is financing a programme to improve quality of education for four million pupils. Malte Jäger / Laif

Basic education in low-income countries is falling victim to cuts in development aid by donors like the United States, Switzerland, and others. Can charitable foundations make up for the shortfall and improve learning outcomes?

With 90 pupils in her classes, Diana Zacharia admits that meeting the needs of each child can be a heavy load.

The primary school teacher in the provincial Tanzanian city of Arusha, a few hours’ drive from the iconic Mount Kilimanjaro and Serengeti plains, has learned to ease that burden with help from Swiss development group Helvetas.

The NGO offered Zacharia and her colleagues two years of training. It introduced ideas, such as getting students involved in preparing lessons and helping each other, to boost engagement in class and bring textbook knowledge to life.

The course elevated Zacharia’s confidence. “It’s totally changed me,” she said. “The closeness between student and teacher has grown, which helps me to understand them better.”

It’s also having proven benefits on the pupils: those taught by teachers who have been through the training are more likely to achieve top grades in maths exams.

Countries such as Tanzania have made progress in enrolling children in school in recent decades. Yet globally, challenges persist. Some 272 million children worldwide are unschooledExternal link, many classrooms are overcrowded, and teachers lack training.

Now, further gains in basic literacy and numeracy are coming under threat as foreign aid budgets across the rich world face the axe. UNICEF, the United Nations Children’s Fund, anticipatesExternal link a $3.2 billion (CHF2.5 billion) drop in funding for education by the end of 2026 as state donors cut aid in favour of defence spending. The shortfall could put an estimated six million children out of school.

Behind this funding gap is the dismantling of USAID, the world’s biggest bilateral donor in basic educationExternal link, by US President Donald Trump. Switzerland, which cut CHF250 million ($315 million) from its 2025 development assistance budget, will also stop funding basic education in low-income countries. In the United Kingdom, plans to reduce aid by about £6 billionExternal link (CHF6.35 billion) by 2027 will affectExternal link education programmes in several African countries, according to an official assessment.

Hopes pinned on philanthropies

Amid such drastic cuts, all eyes are on alternative sources of cash, such as charitable foundations, to sustain essential work. Philanthropies worldwide gaveExternal link $9.6 billion in development aid in 2020. In Switzerland, some 1,000 foundations are active in this area.

“Everyone is asking where we can get more money, and foundations are seen as a key source,” said Fritz Brugger, head of the NADEL Centre on Global Cooperation and Sustainable Development at the federal technology institute ETH Zurich.

Working with foundations isn’t new. In 2023 the Swiss Agency for Development and Cooperation (SDC) had partnershipsExternal link with roughly 50 grant-making foundations. Helvetas, whose core financial contribution from the SDC is being cut by 10%, received funds mainly from the Liechtenstein-based Medicor Foundation for its teacher-training in Tanzania.

Now governmentsExternal link and NGOs are looking to such philanthropies to carry a heavier load.

“There are growing expectations that private foundations will fill some of the gaps left by reduced official development assistance,” said Sabrina Würmli, head of skills, jobs and income at Helvetas. “Their role in international cooperation will become even more significant.”

The world’s richest charitable foundation, the Gates Foundation, saysExternal link philanthropy must now step up with targeted funding to have maximum impact. The foundation is injecting more than $240 million over four years in sub-Saharan Africa and India to cover basic, or foundational, learning for 15 million children.

What is a charitable foundation?

A foundation is an estate created for a specific purpose and managed by a board of trustees. In Switzerland, a foundation must have minimum capital of CHF50,000. More than 13,000 foundations are registered in Switzerland.

A grant-making foundation “does not rely on donations or fundraising to finance its activities”, the consulting firm PwC explainsExternal link. A spend-down foundation uses income generated by its assets and the assets themselves. Swiss charitable foundations are eligible for tax exemption.

Source: PwC/Swiss Foundations

Simon Sommer, co-CEO of the Zurich-based Jacobs Foundation, which has invested over CHF1 billion in children’s education since 1989, said his organisation is “committed to expanding partnerships and collaborating with other actors”.

Basic skills can raise world economic growth

“Basic literacy and numeracy are the building blocks for all future learning,” Sommer argued. “Without them, children struggle to progress in school and later in life.”

UNICEF saysExternal link foundational learning offers the highest return on investment. A 2022 studyExternal link by the International Monetary Fund estimated that giving every child basic educational skills would raise world economic output by $700 trillion over the rest of this century.

Despite that, the SDC has decided to stop funding foundational learning following budget cuts. It’s now focusing more on vocational training and education in emergencies, such as conflict zones, where it has a “comparative advantage” and can “achieve the greatest possible impact”, said a spokesperson.

Increasing money versus redirecting funds

Yet as cash flows from traditional donors slow, philanthropies lack the resources to fill the gap. Their total grants worldwide are equivalent to just 6% of state development aid.

In May, Bill Gates saidExternal link he would give away all of his wealth through his eponymous foundation in the next 20 years, doubling its giving, before shutting down in 2045.

Nevertheless, Gates Foundation CEO Mark Suzman toldExternal link the Financial Times that its annual budget, which is approaching $9 billion, still falls “far short of the $40 billion a year that USAID traditionally spent”. The foundation has also said it will not extend spending on basic education beyond sub-Saharan Africa and India.

“The potential of foundations to fill gaps left by cuts in aid budgets is to some extent hypothetical,” said Brugger of NADEL. “It only has a compensatory effect if foundations increase their overall spending – otherwise funds can only be redirected to other purposes.”

The Jacobs Foundation, however, is hopeful it can increase the amount of money available. This year it took full control of its assets and adopted an investment strategy that Sommer said would allow it “to expand its philanthropic commitments in the coming decades”.

The foundation is currently supporting programmesExternal link to strengthen basic education systems in Ghana, Ivory Coast and Colombia.

Guaranteeing good learning outcomes

The impact that philanthropy can have also depends on know-how and capacity. Large foundations like Jacobs may be able to invest in systemic improvements, needed if governments “want to advance basic education at the national level”, said Brugger. Smaller foundations, on the other hand, can mainly provide financing for single projects, such as running a school.

“The focus of the donor community has for too long been to enroll everybody in primary school without paying enough attention to teaching quality,” said Brugger. Helvetas is trying to address this in Tanzania. Helvetas

How cash is spent is therefore as important as finding it.

“Just having money for the sector doesn’t guarantee good [learning] outcomes,” Brugger said. “There are huge issues with quality of teaching, class sizes and absenteeism.”

In Tanzania, less than half of children aged nine to 13 passed numeracy and literacy tests, a 2019 reportExternal link found. Drop-out rates are also high.

Würmli at Helvetas said the NGO’s teacher training “cannot solve all the problems in schools, but it can make a substantial contribution”. A 2022 impact assessment found pupils exposed to teachers who followed the training outperformed their peers in other classrooms in national maths exams, and were up to six percentage points more likely to achieve a top grade.

The ongoing cuts, Würmli said, “underscore the importance of maintaining a diverse and broad funding base” for NGOs such as Helvetas, which has helped train teachers in 160 Tanzanian schools and is looking to scale this up.

In Arusha, primary school teacher Zacharia is making the most of what she’s learned to keep pupils engaged in class. 

“If the children know that today we are doing an experiment, they want to come to school instead of staying home,” she said. “They enjoy it a lot. And the lessons are sticking.”

Edited by Tony Barrett/bvw/ts. With additional reporting by Samanta Siegfried.