SANTIAGO (Reuters) - Chilean President Michelle Bachelet's landmark education reform passed its first major hurdle on Tuesday after the Lower House approved the bill and sent it on to the Senate, where a heated debate awaits.
The multi-pronged reform initially seeks to put an end to profits at state-subsidized schools and to eliminate selective entrance policies at those establishments. It will be financed by a recently approved tax overhaul that will increase the state's coffers by $8.3 billion.
Though the government's center-left political bloc has a majority in Congress, it does not have enough votes to ram the education reform through and will need to negotiate and likely make concessions to the center-right opposition.
"There is no doubt about it, today is important ... because this is one of President Bachelet's emblematic projects. It has left the Lower House and is on its way to the Senate, where we expect to discuss it with all the depth that's needed," said Education Minister Nicolas Eyzaguirre.
Bachelet took office in March pledging to make major changes to Chile's education system, which was privatized under the dictatorship of General Augusto Pinochet, and is often of poor quality and expensive, favoring those who have the means to pay.
Chile had the highest gross domestic product per capita in Latin America last year, according to estimates from the International Monetary Fund, but ranked worst in income equality among the Organization for Economic Co-operation and Development's 34 member states.
Police clashed with thousands of students on the streets of the capital, Santiago, in August, demanding the government to speed up the process of national education reform.
"This project is absolutely key because it will effectively allow families to choose what school (kids go to)" instead of it depending on cultural or economic status, or another type of discrimination," Eyzaguirre added.
Lawmakers in the Lower House approved a ban on capital gains for the owners and administrators of schools that receive state subsidies, though a more contentious point that would have penalized this with jail time was rejected.
Additionally, the state will increase how much money it spends per student at state-subsidized schools to ease the financial burden on families, especially those from low- and middle-income sectors of society.
(Reporting by Antonio de la Jara; Writing by Anthony Esposito; Editing by Alan Crosby)