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Sunday, May 27, 2012

What is the Per Child Expenditure in Government Schools?

Ambrish Dongre
The Supreme Court, in its landmark judgment, upheld the constitutional validity of a controversial provision in the Right to Education (RTE) Act- reservation of at least 25% of admissions in  class I / the entry level, ‘for children belonging to weaker sections and disadvantaged groups in the neighborhood, and provide free and compulsory education…’
Now that the Court has delivered its judgment, focus should be on the implementation of this provision.
As per the RTE act, the private unaided schools ‘shall be reimbursed expenditure so incurred by it to the extent of per child expenditure incurred by the State, or the actual amount charged from the child, whichever is less’. So if the State spends Rs 1500 per child and a private school spends Rs 2000, such a school would be reimbursed Rs1500 per child admitted under the 25% reservation policy. But to implement this clause effectively, we need to know precisely how much both the State and private schools spend on a per child basis.
The Government of India (GoI) funds elementary education through the Sarva Shiksha Abhiyaan (SSA), the flagship scheme for universalizing elementary education in the country. SSA accounts for 67% of total elementary education budget of the GoI in FY 2012-12[1]. As per calculations of my colleague, Shailey, per child allocation at an all India level under SSA stood at Rs 4,269 for financial year 2011-12. This number varies from state to state- Rs 7037 for Chattisgarh, Rs 3,049 for Gujarat, Rs 27,451 for Meghalaya to give just a few examples[2]. But traditionally, elementary education in India has been primarily financed by the state governments. Our previous research shows that as per 2009-10 estimates, 74% of total education budget was financed by the state governments[3]. Hence one has to include their share to get a better sense of true allocation and spending on every child enrolled in government schools. Per Child Allocation after including the state budgets for seven ‘PAISA’ states is indicated in the following table.
StatePer Child Allocation(Rs 2009-10)
Andhra Pradesh8,390
Himachal Pradesh19,111
Madhya Pradesh4,423
West Bengal3,982

It’s quite natural that per child allocation and expenditure will vary across the districts within a state. So it’s absolutely essential to calculate such allocation and expenditure at district level, so that these numbers could be used while deciding payment to the private schools. But calculating district level per child numbers is quite tricky. There are no district level budget documents. Hence my colleagues, Avani & Anirvan, with help from Prof. Anit Mukherjee (NIPFP), devised alternative ways of calculating these numbers for 9 districts in the 7 states mentioned above. Wherever the State treasuries have been computerized, such as Andhra Pradesh and Himachal Pradesh, data on treasury flow to bank accounts of the designated officers at the district level (Drawing and Disbursing Officers (DDOs) was collected to derive the exact allocations. In remaining 5 states, where the treasury account information could not be accessed, district budget was estimated on the basis of proportion of schools, teachers and students in a given district compared to a state[4].
District(State)Per Child Allocation(Rs 2009-10)
Medak(Andhra Pradesh)7,588
Kangra(Himachal Pradesh)19,574
Sagar(Madhya Pradesh)3,616
Jalpaiguri(West Bengal)4,935
The table clearly reveals that there is variation across districts in per child allocations even within a state. The difference is Rs 1,137 in case of Jaipur and Udaipur, and Rs 878 in case of Nalanda and Purnea in Bihar. Note that we have excluded allocations for implementing ‘Mid Day Meal’ scheme from these calculations. Once they are added, the numbers are bound to go up quite substantially.
These calculations must be done for every district in the country to get some sense about how much every district is allocating for every child enrolled in government school, and accordingly, payment to unaided private schools should be decided. In order to make sure that calculations are robust, all underlying data should be publicly available so that one can replicate these calculations.
So far we have been talking only about per child allocation, while the act talks about per child expenditure. When it comes to expenditure, there is an additional complication that audited expenditure data becomes available only after a lag of 2-3 years, and expenditure performance of governments fluctuates wildly from one year to another, which makes the task of estimating expenditure even more difficult.
There is even more ignorance when it comes to functioning of private schools and fees charged by them. In fact, what most do not know is that private schools in much of India spend far less than per child allocation in government schools.  A recent study by India Institute, based on a census of schools in Patna, shows that 69% of these private unaided schools charge less than Rs 300 per month. This is far lower than per child allocation of Rs4,705 in Bihar[5]. But these fees are likely to change dramatically in the context of RTE norms regarding teacher wages and infrastructure which every school has to follow. 
Given the potentially large transfer of public resources to private unaided schools in the next few years, public availability of information regarding the fees charged by private schools and the manner in which these are determined are essentital for ensuring scrutiny of public expenses.
It goes without saying that the education departments should display list of all private unaided schools admitting students under 25% reservation category along with the fees they charge, on their web-pages. Delhi government’s department of education has already taken the first step. Going further, schools should be required to submit a statement indicating their costs under different heads and fees charged, at least on annual basis, which again, should be displayed on the education department’s webpage. The government should come up with a standardized format for such a statement, which will facilitate scrutiny of expenditure undertaken by private schools and meaningful comparisons across private schools.
This shows that a lot more work needs to be done to ensure effective implementation of such a landmark judgment.

[1] Sarva Shiksha Abhiyan, GoI 2012-13Budget Briefs, Accountability Initiative
 [2] Do Schools Get Their Money (PAISA 2011)Accountability Initiative
[3] The sample consisted of 7 states of Andhra Pradesh, Bihar, Himachal Pradesh, Madhya Pradesh, Maharashtra, Rajasthan and West Bengal. (Analysis of State Budgets: Elementary EducationAvani Kapur (2011), Accountability Initiative.) 
[4] Details of methodology are given in ‘PAISA District Studies (Rural) 2011’ available on our webpage,  
[5]The Private School Revolution in Bihar: Findings from a Survey in Patna Urban, Baladevan Rangaraju, James Tooley & Pauline Dixon, India Institute, 2012

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