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Growth and Financing of Elementary Education in Uttar Pradesh: A Province in India P. Geetha Rani National Institute of Educational Planning & Administration New Delhi, India Citation: Rani, P. G., (2004, June 13). Growth and financing of elementary education in Uttar Pradesh: A province in India. Education Policy Analysis Archives, 12(25). Retrieved [Date] from http://epaa.asu.edu/epaa/v12n25/. Abstract The present article attempts to study financing patterns of elementary education in Uttar Pradesh. A review of educational development in the state reveals that the goal of universalizing elementary education in a resource-poor state seems to be elusive in the near future. Neither the financing pattern of education per se nor elementary education in particular is conducive to achieving the target of universal elementary education. The magnitude of out-of-school children (leaving or dropped-out children) vis-à-vis the resources allocated toward elementary education provides a gloomy picture in the state. Financing the additional resources required to universalize elementary education in the state would require significant reallocations in overall expenditure with federal assistance, since the fiscal situation in Uttar Pradesh is highly imbalanced. The state and central government should bear the entire responsibility of funding and ensure the twin principles of equity and efficiency in the public education system in the state. This requires an indomitable political commitment in terms of reorientation of spending priorities and improving the efficiency of resource use in the state. This study reaffirms that the goal of universal elementary education could become a reality only if there is a joint commitment between the federal and state polities. Introduction Investment in basic education contributes immense of benefits and further perpetuates the benefits into the future generations. Benefits of education include the economic and social returns; decline in poverty and income distribution; fertility, population and health outcomes; political and economic development; dynamic externalities associated with education and above all better quality of life. The importance and hence the provision of free and compulsory elementary education is well recognized in the international and national arena. At the international level, in Article 26 of Universal Declaration of Human Rights, (UN,1950); Articles 13 and 14 of the International Covenant on Economic, Social and Cultural Rights (1966) and Article 28 of the Convention on the Rights of the Child(1989) (Note 1), Human capital revolution around 1960s, World Conference on Education For All at Jomtien in 1990 and adoption of World Declaration on Education for All (EFA) in the same conference and its assessment at Dakar in 2000 have well established the importance of education in the social, economic and political development of a nation. The Government of India in its preamble in the Constitution under Article 45, made a resolution to provide free and compulsory education up to the age of 14 within a period of 10 years. The National Policy on Education, 1986 and the Programme of Action in 1992 reiterated the Constitutional Directive that free and compulsory education of satisfactory quality be provided to children up to the age of 14 years before the 21st century. Though this target period has been revised time and again, recently the bill on Elementary Education as a Fundamental Right has been passed in the parliament in its 93rd Amendment. Elementary education as a fundamental right underlines the paramount significance of the Central government in achieving universal elementary education. In the educational planning and development strategy, though the underlying principles are promoting regional equity and efficiency in the system, still there exists a great deal of variation in the educational development across states. In the continuum, at one end, we have Bihar with the lowest literacy rates (47 percent in 2001 census) and on the other Kerala with near 100 percent literacy rates (91 percent in 2001 census). Few states, especially Himachal Pradesh and Tamil Nadu, exhibit outstanding success in educational development within a short time span. Himachal Pradesh is one of the educationally developed states after Kerala, Goa and Maharashtra according to the 2001 census. The progress in educational development is a recent phenomenon in this state since the 1980s, and it progressed at a much faster rate than other states. On the contrary, experience of economically and educationally least developed and at the same time one of the most populous and geographically largest, Uttar Pradesh provides a hard reality of an Indian state. It is in this light, the causes for such backwardness in the educational development of Uttat Pradesh deserve to be studied. The present study examines a very specific aspect, viz., that of financing elementary education in Uttar Pradesh, one of the important determinants in achieving universal elementary education. It is to be noted that there are number of other equally important factors which also determine the educational progress in a state. The present study attempts to examine major issues on financing elementary education in Uttar Pradesh in the recent two decades, from 1980-81 to 1999-2000. The scheme of the study is as follows: First a brief account of the socio economic development and a review of educational development in the state is presented. Then the discussion brings out the importance of education in the overall state plan and non-plan resources per se. The next section is devoted to the analysis on financing elementary education in particular, besides the role of central government in and external aid to financing elementary education. The last section provides the concluding remarks. The information for the study is culled from various sources, viz, Analysis of budgeted expenditure on Education and Selected Educational Statistics published by MHRD, state five-year plan documents, national and state statistical abstracts, and the like. Background Uttar Pradesh is one of the least developed states in India with the lowest per capita income of Rs.7743 in 1996-97. Only three states (Assam, Orissa and Bihar) have a lower per capita income than Uttar Pradesh. Economic growth has decelerated in Uttar Pradesh since 1991, while growth accelerated in other states of India. The gap between Uttar Pradesh and the rest of India widened substantially in the 1990s as annual growth in per-capita income slowed down to 1.2 percent in Uttar Pradesh (Ahluwalia, 2000). Poverty and unemployment are the two chronic problems of the state. Though the percent of population living below the poverty line in terms of head count ratios has come down, from 45 per cent in 1987-88 to 31 per cent in 1999-00 (Note 2), the labour force participation in secondary and tertiary sectors is limited due to low literacy levels of the population. In the primary sector, the inherent problems of low levels of productivity and high levels of under employment persist. Severe fiscal crises hinder the state from investing enough to provide economic growth and improve social conditions. The overall fiscal deficit increased to a high of 7.7 percent of gross State Domestic Product (SDP) in 1998-99, among the highest across India. The share of debt service in total state revenues has increased from 13 percent in 1985-86 to more than 39 percent in 1998-99. Salaries, pensions, and interest payments absorbed more than three-quarters of the total revenues in 1998-99. Poor governance has resulted in a narrowing of the tax base (a 25 percent decline in the number of taxpayers between 1993 and 1997), and unsustainable growth in the government’s wage bill. High and growing deficits for more than a decade, together with the slow pace of economic growth, have resulted in an unsustainable level of indebtedness in the state (World Bank, 2000). Social indicators for the state are pitiful. Life expectancy at birth (1993-97) is 57.6 years and remains second from the bottom compared to all other states; IMR in 1999 was 84 and stood third from the bottom; maternal mortality rate per 100,000 live births in 1998 was 707 worst among all states (Note 3); the death rate in 1999 was second highest; the birth rate was the highest at 32.8 in 1999 (Note 4). Uttar Pradesh is one of the most populous states in the country, and there are no signs of reducing the rate of growth of population in the state. For three decades from 1971 to 2001, the rate of growth of population was persistently 2.5 per cent per annum, indicating that the state is still in its primitive stages of demographic transition. This could be mainly on account of low levels of education and restricted role of women in society besides the poor functioning of public services (see, Dreze and Gazder, 1996, Kurian, 2000). Crude Birth Rate and Infant Mortality Rate by Natural Divisions in Uttar Pradesh Region CBR IMR Uttaranchal 23.7 66.1 Eastern 33.8 77.7 Southern 34.0 82.2 Central 34.1 96.7 Western 36.2 97.2 Source: SRS 2000 Data, ORG The Education Scenario in Uttar Pradesh Uttar Pradesh is one of the most educationally backward states in India with 43 per cent of the population as non-literate according to the 2001 census. The progress in literacy rates has been at a snail’s pace in the state for three decades from 1961 to 1981 as can be seen from Table 1. Only in the previous two decades were there signs of improvement in literacy rates. The gender gap in literacy rates exhibits the extent of deprivation of women education in the state. In the knowledge based era of the 21st century not even half of the female population is literate. Table 1 Literacy Rates in Uttar Pradesh Male Female Person (Note 5) Gender Gap[1] 1961 32.63 8.43 21.13 24.20 1971 36.69 12.46 25.44 24.23 1981 38.9 14.42 27.4 24.48 1991 54.82 24.37 40.71 30.45 2001 70.23 42.98 57.36 27.25 Source: Census of India. Elementary educational institutions in the state at the time of independence numbered 38,433 and increased to 118,642 in 1999-2000, about three and a half times. Children enrolled in elementary schools were 30.8 lakhs (a “lakh” is 100,000) in 1950-51 and increased to 166 lakhs in 1999-2000, a five fold increase. Though, it has increased over a long period of time, in recent decades, there is a decline in the children enrolled in primary and upper primary levels of education as can be seen from the simple growth rates estimated for the period 1980-2000 as a whole and between the decades 1980s and 1990s, (see Table 2). Table 2 Growth Rates (Note 6) in Elementary Educational Institutions in Uttar Pradesh Institutions Enrollment Teachers Pry UP Elem. Pry UP Elem. Pry UP Elem. 1980-1990 0.66 2.31 0.95 3.02 10.33 4.28 0.95 4.63 1.83 1991-2000 2.80 3.88 2.98 -0.68 -0.85 -0.71 2.21 1.08 1.91 1980-2000 1.59 2.12 1.68 2.16 4.04 2.48 1.13 2.13 1.37 Source: Estimated based on Selected Educational Statistics That the growth rate in enrollment is negative for the latest decade is a cause for concern. But, growth in the number of teachers in elementary education has been quite high, from 84,804 teachers in 1950-51 to a five fold increase of 426,680 teachers. Though, growth in teachers is almost in pace with increase in enrollment over the long period, if we closely look at the growth rates in enrollment and teachers in 1980s and 1990s, it can be noticed that the growth in number of teachers is positive in the 1990s as against the negative growth rate in enrollment both in primary and upper primary levels. Growth rates indicate that though there have been efforts to employ teachers, but no such effort was generated to increase the enrollment of the children. Table 3 Gross Enrollment Ratio in Elementary Educational Institutions in Uttar Pradesh Year Primary Upper Primary Boys Girls Person Boys Girls Person 1980-81 90.8 45.7 68.9 54.5 19.3 37.5 1985-86 86.4 50.3 69.4 56.7 22.4 40.7 1990-91 89.1 51.0 71.1 63.2 25.6 45.5 1991-92 104.9 66.9 86.9 67.9 33.4 51.6 1992-93 103.7 72.0 88.6 73.4 35.7 55.6 1993-94 103.9 72.8 89.3 72.2 35.4 55.0 1994-95 105.1 72.7 89.8 73.1 35.3 55.4 1995-96 104.3 72.0 89.1 72.3 34.9 54.7 1996-97 85.2 59.9 73.4 62.4 32.6 49.0 1997-98 74.1 48.9 62.3 50.3 27.7 40.0 1998-99 76.0 49.3 63.4 48.9 26.4 38.6 1999-00 78.4 50.2 65.0 48.7 25.8 38.1 Source: Selected Educational Statistics, various issues This is because the teachers and the teacher unions are vocal in the polity (Muazzmil and Kingdon,2001). It is unfortunate that the strength of teachers has not been used to universalize in a broader perspective for the development of education. Gross enrollment ratio as well suggests that there has been a drastic decline in the ratio in recent years. The decline is sharp from 1996-97 onwards, in both boys and girls and also in primary and upper primary enrollment ratios as shown in Table 3 (Note 7). In the year 1999-2000, 25 per cent of the boys and 50 per cent of the girls of the eligible age group children are not enrolled in any schools at the primary level. The situation is far bleak at the upper primary level that 50 per cent of the boys and 75 per cent of the girls are not enrolled at upper primary level. Table 4 Children Enrolled in Different Management by Region in 1993 (in %) Primary Government* Private Aided Private Unaided All (in lakhs) Rural 88.7 2.5 8.8 103.4 Urban 35.9 10.7 53.4 27.0 Total 77.8 4.2 18.0 130.5 Upper Primary Rural 39.5 32.2 28.3 30.7 Urban 22.8 47.5 29.6 14.7 Total 34.1 37.2 28.7 45.4 * Includes local bodies; Source: NCERT(1998), Vol.II. Enrollment in Schools. It is often argued that the decline in enrollment (which corresponds to enrollment in government and private aided schools) might be on account of increasing numbers of children enrolled in private unaided schools. However, it can be seen in Table 4 that, in the early 1990s enrollment in government / local bodies schools is predominant in the state. Enrollment in private unaided schools is a phenomenon only in the urban area. However, the PROBE (1999) survey found that even in rural areas the children, particularly males, are increasingly enrolled in private unaided schools. The information from the household surveys on attendance rates suggests an improvement in the middle and late 1990s as shown in Table 5. Attendance rate is a better indicator when there is a large gap between children enrolled and actually attending schools. Table 5 Attendance Rates in Uttar Pradesh Rural Urban Total Male Female All Male Female All Primary(1995-96) (Note 8) 67 49 59 73 69 72 61 Upp.pry (1995-96) 77 46 63 80 72 76 66 Primary(1998-99) 83 71 78 87 83 85 79 Upp. Pry (1998-99) 80 57 70 81 80 81 72 Source: NSSO(1998), pp.A41-47 correspond to year 1995-96; IIPS(2001) NFHS –II; 1998-99 Though there has been improvement in the attendance rates, still there is a huge number of children dropping out. The rate of drop-out is higher among girls in primary and elementary levels of education and it has been increasing over the years (see Table 6). Table 6 Drop-out Rates in Uttar Pradesh 1997 1998 1999-00 Total Girls Total Girls Total Girls Primary 49.85 55.98 49.88 57.49 56.64 62.16 Elementary 52.45 57.28 53.11 57.9 53.01 57.94 Source: Selected Educational Statistics, various years. While investigating the relationship between work and education of children in two villages of Uttar Pradesh, Lieten (2000) found that the drop-out factor is more likely to be associated with push factors internal to the school than to the pull factors emanating from the labour market. In addition to the children who dropped out, 1.6 crores (a “crore” equals 10 Million) children in the age group 6-14 were never enrolled in school. Percentages of out-of-school children estimated based on the 1991 Census in Uttar Pradesh in the age group 6-11 is 63 per cent and in the age group 11 –14 is 47 percent as against 48 and 36 percent for the country (Note 9). It is a challenge for the state as well as for the central government to bring these out-of-school children into schools and retain them in schools. Then only can the unaccomplished goal of universalizing elementary education can become a reality. The recent NFHS survey identified that 38 per cent of the urban male never enrolled children cited that it costs too much to enroll in schools. As noted earlier, the twin chronic problems of poverty and unemployment ill-resulted in children never enrolled and even if enrolled drop out due to the grip of the vicious circle of poverty and child labour combined with poor quality of schooling. The glaring fact from this quick review is that the goal of universalizing elementary education in a resource poor state seems to be elusive in the near future. The goal could become a reality only if there is indomitable and concomitant will between the federal polities combined with social mobilization within the state. Public Expenditure on Education in Uttar Pradesh The role of State assumes paramount significance in reaching the goal of providing free and compulsory education up to the age of 14. The amount of resources required for accomplishing the unfinished agenda remains high. This section highlights the major issues relating to financing education in Uttar Pradesh, viz., the relative importance of education in the overall economic development of the state in terms of planned and non-planned expenditures; the relative share of education expenditure in planned and non-planned accounts, and education and other departments’ contribution to education focusing the period from 1980-81 to 1999-2000. In India, at the central and state level, it is the task of the Planning Commission and state planning boards at the state level to allocate planned resources to various sectors of the economy. The maintenance of the investment made in the planning framework is taken care of by another statutory body, namely the finance commission. The share of plan education expenditure in the total plan expenditure of the state and similarly the share of non-plan education expenditure in the total non-plan expenditure is reported in Table 7 for selected years. In the total plan expenditure of the state government, from 4 to 14 per cent of expenditure is allocated to education expenditure in the plan account. In the early 1980s, the share of plan expenditure was in single digit and improved in the late 1980s and again declined drastically in the beginning of 1990s. It could be mainly on account of the structural adjustment program, which began in the 1990s. From the middle of 1990s onwards, there has been improvement in the plan allocation for expenditure on education. However, the major problem in the state is low economic growth, 4 per cent growth of SDP (1.2 per cent growth of per capita SDP) and hence the overall resources available within the state itself are meager. Table 7 Share of Plan and Non-plan Education Expenditure in Total Plan and Non-plan Expenditures Year % of edn plan to state plan % of edn non plan to state non plan 81-82 5.0 24.5 82-83 7.1 24.5 84-85 7.5 24.7 89-90 13.11 26.7 90-91 7.33 25.94 92-93 4.4 22.64 93-94 5.26 20.0 94-95 10.91 20.7 95-96 14.01 19.85 96-97 12.69 21.38 97-98 12.15 19.63 98-99® 10.04 20.14 Source: Analysis of Budgeted Expenditure in the Education Sector, MHRD, various years. In the non-plan account, the share of education expenditure fluctuates from 20 to 25 percent in the state during the last two decades. Though, in the recent finance commissions, the non-performing states like Uttar Pradesh have been allocated a higher share of transfers (based on backwardness index, infrastructure index, etc.), given the extent of backwardness and dysfunctional governance in the state makes it more difficult for any signs of improvement and development in the state. Table 8 Share of Expenditure on Education by Department of Education & Other Departments in Uttar Pradesh Year Education dept Other dept Total (in %) (Rs.in Crs) 1980-81 91.70 8.30 378.30 1985-86 89.78 10.22 855.73 1990-91 90.60 9.40 2295.68 1991-92 88.60 11.40 2240.39 1992-93 88.80 11.20 2783.90 1993-94 87.85 12.15 2639.35 1994-95 88.47 11.53 3302.87 1995-96 90.12 9.88 4400.30 1996-97 86.38 13.62 4426.00 1997-98 93.37 6.63 4431.31 1998-99 85.38 12.32 6471.52 1999-00® 85.38 14.62 6873.10 2000-01(B) 91.68 8.32 4241.11 Source: Analysis of Budgeted Expenditure in the Education Sector, MHRD, various years. Education expenditures primarily flow from the education department of the government. In addition, other departments such as Ministry of Health, Ministry of Welfare, etc., spend on education. About 10 to 12 percent of the total expenditures on education flow from other departments (see Table 8). The problem among the developing countries is that the majority of expenditures is allocated for non-plan, i.e., salary and other expenditure as education is predominantly a labour-intensive sector. In this resource-starved state as well, about 10 percent of the expenditure on educationaccount for developmental activity, viz., building of schools, acquiring additional class rooms, infrastructure, etc. The major share of the expenditure is taken away for the non- developmental activity of maintenance of the system. Growth rates in both plan and non-plan expenditures in the 1980s are higher than in the 1990s. Table 9 Share of Plan and Non-plan Expenditure on Education in Uttar Pradesh Year Plan Non-plan Total (in %) (Rs.in Crs) 1980-81 4.22 95.78 346.92 1985-86 6.05 93.95 768.27 1990-91 7.46 92.54 2079.84 1991-92 8.23 91.77 1984.95 1992-93 3.91 96.09 2472.04 1993-94 5.18 94.82 2318.67 1994-95 10.31 89.69 2922.19 1995-96 14.59 85.41 3965.37 1996-97 10.85 89.15 3823.24 1997-98 9.78 90.22 4137.51 1998-99 6.86 93.14 5674.42 1999-00® 10.10 89.90 5868.25 2000-01(B) 13.14 86.86 3888.06 Growth rates 80-81 to 89-90 28.02 17.13 17.88 90-91 to 00-01 17.82 10.30 10.90 80-81 to 00-01 18.93 15.18 15.49 Source: Analysis of Budgeted Expenditure in the Education Sector, MHRD, various years. This is against the experience of some of the other states; for example, for Karnataka, Himachal Pradesh, and Tamil Nadu in the 1990s, the growth ofplan expenditures in total expenditure are much higher. It is because plan funding from Center has increased after adoption of National Policy on Education 1986 which gave a meaningful definition to the concurrency of education enshrined in the Constitution through its 42nd amendment. But in Uttar Pradesh even with central funds, the growth rates in plan expenditures during 1990s are less compared to 1980s. This indicates that the state funds are not coming forward even when there is central support, (see, Bashir, 2000). This unambiguously illustrates the state’s lack of financial commitment to education. Allocation of Resources Yet another important dimension of financing education is looking at the allocation of resources to education. There are three important aspects relating to allocation of resources to education: a) allocation of resources to education vis-à-vis other sectors, referred as inter-sectoral allocation of resources; b) intra-sectoral allocation of resources within education, i.e., allocation to different levels of education; and c) inter-functional allocation of resources to different activities such as teaching, administration, student welfare, etc. (Tilak, 2002). Inter-sectoral allocation of resources Inter-sectoral allocation of resources is examined by looking at a couple of important indictors, viz., share of education expenditure in total income of the state and share of education expenditure in total revenue expenditure in Uttar Pradesh. Share of education expenditure in SDP reflects the relative priority given to education in the state economy. Uttar Pradesh allocated on average 3.4 percent during 1980s and increased this amount to 4.5 percent in the 1990s, (see Table 10). In a resource poor state, even a lesser expenditure would show a higher share as income itself is growing at a slower rate. The data in Table 10 suggest that there is fluctuation in both the share of SDP and share of revenue budget in the state. Table 10 Share of Total Education Expenditure in SDP and State Budget in Uttar Pradesh Year % of SDP % of State Budget 1980-81 2.70 22.04 1985-86 3.47 23.11 Average 3.42 22.63 1990-91 4.64 24.07 1991-92 3.92 21.54 1992-93 4.49 21.94 1993-94 3.78 19.87 1994-95 4.17 21.41 1995-96 4.97 25.06 1996-97 4.30 23.04 1997-98 3.92 19.97 1998-99 5.72 24.82 1999-00® 4.17 22.48 2000-01(B) 3.93 19.66 Average 4.36 22.17 The national share of education expenditure to GDP was around 3.4 per cent in 1999-00; thus, neither Uttar Pradesh nor the nation has followed the recommendations of Education Commission(1966) which fixed a target of 6 percent of GDP to investment in education from public exchequer by 1986. Table 11 Share of Education Expenditure in State Domestic Product (SDP) & State Budget in Major States in India in 1989-90 and 1997-98 1989-90 1997-98 States % of SDP % of Budget % of SDP* % of Budget Andhra Pradesh 4.6 24.5 2.9 16.6 Assam 6.0 25.5 9.1 33.4 Bihar 6.3 28.1 6.9 29.8 Gujarat 4.3 24.3 4.0 21.2 Haryana 3.1 18.6 4.0 14.7 Himachal Pradesh 8.8 22.6 7.2 21.3 Karanaka 4.3 22.1 3.5 21.8 Kerala 6.5 30.4 4.4 23.9 Maharashtra 5.0 24.2 2.8 23.9 Madhya Pradesh 3.2 21.1 4.2 23.4 Orissa 5.4 24.2 5.9 24.4 Punjab 3.5 22.7 3.6 17.2 Rajsathan 5.3 26.5 5.3 25.2 Tamil Nadu 5.0 23.7 4.1 22.2 Uttar Pradesh 4.6 24.0 4.0 20.0 West Bengal 5.4 30.4 4.6 24.1 India 4.9 13.7 3.9 13.2 Source: Analysis for Budgeted Expenditure on Education, 1997-98 to 1999-2000. Share of education expenditure in SDP in Uttar Pradesh vis-à-vis other major states in the country in the year 1989-90 suggests that only four states (Madhya Pradesh, Punjab, Haryana and Gujarat) allocated a lesser share of SDP than Uttar Pradesh (see Table 11). But in 1997-98, the allocation marginally declined. Education expenditure as percent of revenue expenditure indicates the relative priority given to education in the government budget. The share ranges between 19 and 25 percent in Uttar Pradesh. This share is much less than Kerala, which allocates 30 and 24 percent of revenue expenditure to education in 1989-90 and 1997-98, respectively, (see Table 11). Uttar Pradesh is placed at the middle and allocated 24 per cent during both periods. Only three states Andhra Pradesh, Haryana and Punjab allocated lesser government expenditure on education than Uttar Pradesh. Expenditures on education indicate to what extent the education sector is accorded importance in the five year plans of a state. The inter-sectoral allocation in the five year plans in the state exhibits three phases, (see Table 12). The first phase consists of the period from first to third plan, where allocation of resources to the education sector ranged between 6 to 13 percent in the total plan expenditures. The second phase consists of (declining period) from annual plans to the seventh plan, the resources allocated to education ranged between 3 to 6 percent of the total plan expenditures. At the national level and many of the educationally progressing states like Himachal Pradesh and Tamil Nadu, the increasing plan allocation could be found from the sixth plan onwards, while such a trend seems evident in Uttar Pradesh only from the annual plans (1990-1992) truly from eight plan onwards. This is the third phase of increasing trend of resources allocated to education. Table 12 Inter-Sectoral Allocation in Five-Year Plans in Uttar Pradesh (in%) I plan II plan III plan Annual plans IV plan V plan VI plan VII plan Annual plans VIII plan Agriculture & allied 25.5 30.7 29.3 29.3 20.7 14.6 13.7 19.1 17.7 21.6 Irrigation, flood control & energy 36.6 35.2 39 49.9 54.2 57.8 49.4 41.2 48.5 37.6 Industry & minerals 4.2 5.5 3.7 4 3.6 6.2 6.5 5.8 2.95 2.7 Transport & comm. 4.5 6.6 5 3.7 6.7 8.5 10.3 10.7 8.7 11.7 Social Sector 29.2 16.3 15.0 13.0 14.8 12.9 20.1 23.2 21.7 24.8 Education 12.8 6.1 8.0 2.7 5.6 3.7 3.3 4.0 6.2 5.3 Health 8.5 4.2 4.4 3.4 4.9 3.2 2.9 3.8 4.0 2.6 Total (Rs. In crs) 153 233 560 455 1165 2909 6594 11948 6903 21679 Source: Various State Plan Documents, Uttar Pradesh. It can be noted that Uttar Pradesh is lagging behind by fifteen years that of the educationally progressive states in terms of the plan resource allocated to education. It is because though earlier plan documents commit for educational development in the state, the same does not get reflected in the resource allocation under five year plans. It is more important to maintain and further enhance the plan resources for education in the tenth plan as well. Intra-sectoral allocation Allocation of resources within education sectors reflects the relative priorities assigned to different levels of education. The educationally backward state needs to allocate a higher share to elementary education, which is found to be true in the state under various five year plans. But the disturbing trend is that it fluctuates a great deal over various plans (see Table 13). In the first plan, the highest share of 70 percent of the total expenditure on education was spent on elementary education. This has been fluctuating and had fallen to a drastic low level of 42 percent in sixth plan. This is against the trend observed at the national level and in many of the educationally progressing states. In the eighth plan, the share touches 60 per cent of the total expenditure, which again declines to 50 per cent in the ninth plan. (Note 10) Table 13 Intra-sectoral Allocation of Plan Expenditure in Education in India in the Five-Year Plans Elementary Secondary Higher Others Total (Rs. In lakhs) % of Plan Education Expenditure in Total Plan Expenditures I plan 70 7 2 20 1807 12.8 II plan 59 21 12 8 1431 6.1 III plan 66 17 11 6 4471 8.0 Annual plans 59 19 19 2 1231 2.7 IV plan 66 17 11 5 5701 5.6 V plan 53 28 13 6 9404 3.7 VI plan 42 35 14 9 21483 3.3 VII plan # 56 21 16 7 48225 4.0 VIII plan* 61 19 15 5 115775 5.3 # Up to 1983-84, actual expenditure and 1984-85 – anticipated expenditure; * outlay Source: Various State Plan Documents, Uttar Pradesh. The pattern of resources allocated under various plans for overall education and for elementary education in the state leaves much to be desired. The ray of hope visible in the eighth plan for education seems to disappear in the reduced allocations towards elementary education in the ninth plan. The financing pattern of education in Uttar Pradesh in terms of any of the indicators (viz., share of plan education expenditures to total plan expenditures, share of non-plan education expenditures to total non-plan expenditures, share of education and other departments in education expenditures, share of education expenditures in SDP and revenue expenditures, resource allocation under various five year plans and for elementary education) exhibits a pessimistic outlook. The magnitude of out-of-school children besides the dropped-out children vis-à-vis the resource allocated toward education in terms of any of the indicators provides a gloomy picture in the state. Financing Elementary Education in Uttar Pradesh Financing elementary education in Uttar Pradesh can be analysed by examining the relative importance given to elementary education in state’s income, government budget expenditure and in the total education expenditure covering a period of about two decades from 1980-81 to 1999-00. It can be observed from Table 14 that around 1.2 to 2.4 percent of the State domestic product is allocated for elementary education over a period of 20 years. To bring back the 2 crores of out-of-school children into schools, the resource allocation to elementary education needs to be enhanced. The relative importance of elementary education in the state budget ranges from 8 to 13 percent. However, there is fluctuation among various years specifically in the period of 1990s, which could be attributable to its slow growth of income and fiscal crisis and to some extent the impact of structural adjustment program and economic reforms. As far as the share of elementary education expenditure in the total expenditure on education is concerned, it ranges from 39 to 64 percent in the state. In many years, it is between 40 to 50 percent. In the 1990s, when there was greater mobilization of resources and various movements towards achieving the goals of education for all, the norm in many states with regard to intra-sectoral allocation for elementary education was 60 percent. In Uttar Pradesh, the share of elementary education was only 49 percent even in 1998-99. Table 14 Budget Expenditure on Elementary Education as Percent of SDP, Revenue Expenditure & Total Expenditure on Education in Uttar Pradesh Year % of SDP % of rev expr % ele in total edn* 1980-81 1.22 9.99 45.32 1981-82 1.25 9.88 44.37 1982-83 1.33 9.88 41.74 1983-84 1.36 9.60 41.83 1984-85 1.57 10.23 42.67 1985-86 1.54 10.26 44.41 1986-87 1.63 10.21 64.11 1987-88 1.50 8.99 39.52 1988-89 1.79 10.48 45.08 1989-90 2.43 13.21 50.10 1990-91 2.45 12.70 52.75 1991-92 1.86 10.25 47.58 1992-93 1.75 8.56 39.00 1993-94 1.60 8.41 42.31 1994-95 1.80 9.23 43.09 1995-96 2.10 10.61 42.32 1996-97 2.07 11.09 48.14 1997-98 1.99 10.15 50.82 1998-99 2.82 12.23 49.27 1999-00® 1.90 10.25 45.57 2000-01(B) 1.92 9.61 74.63 * Includes expenditure on education by department of education and other departments. Source: Analysis of Budgeted Expenditure in the Education Sector, MHRD, various years. Figure 1. Share of elementary expenditures to total education expenditures in major states in India in 1998-99. These figures confirm that the resource poor state is spending much less on elementary education than the national average. It indicates the need for a larger presence of the central government in resource sharing specially in a poor state like Uttar Pradesh, which is not able to generate sufficient resources to meet the challenges of universalizing elementary education. However, in the recent years, there have been efforts made by the state to allocate more resources to elementary education vis-à-vis other major states in India (see Figure 1). Given the enormous number of out-of-school children in the state, the financial commitment needs to be greater than in other states and also sustained for a longer time. The share of plan expenditure in elementary education ranges from 3 to 13 percent of total expenditures, (see Table 15). Plan expenditures grew at a faster rate than non-plan expenditures in the 1980s than 1990s. Table 15 Plan, Non-plan and Per Student Budget Expenditure on Elementary Education in Uttar Pradesh Year Plan Non-plan Elementary Expenditure (Rs. In lakhs) Per Student Elem. Expr. (in %) (In current prices) (in real prices) Current prices Constant prices 1980-81 3.33 96.67 17145 17145 158 158 1981-82 4.38 95.62 18829 17968 165 157 1982-83 4.48 95.52 23360 20532 190 167 1983-84 4.78 95.22 26501 21811 203 167 1984-85 7.77 92.23 33694 25577 245 186 1985-86 6.50 93.50 38002 26144 290 199 1986-87 7.03 92.97 44401 28864 305 198 1987-88 7.50 92.50 45653 27717 298 181 1988-89 11.12 88.88 65549 37464 435 249 1989-90 13.08 86.92 101083 52165 625 322 1990-91 8.34 91.66 121094 55732 765 352 1991-92 8.06 91.94 106591 42619 582 233 1992-93 4.85 95.15 108576 40450 568 212 1993-94 6.30 93.70 111676 37881 572 194 1994-95 5.69 94.31 142333 43742 717 220 1995-96 12.84 87.16 186218 52467 938 264 1996-97 13.52 86.48 213065 55481 1073 279 1997-98 12.95 87.05 225216 54489 1397 338 1998-99 8.09 91.91 318874 77149 2032 492 1999-00® 14.33 85.67 313235 75785 2015 487 2000-01(B) 11.92 88.08 316506 76636 na na Growth rates 80-81 to 89-90 37.13 18.52 19.74 11.20 14.82 6.64 90-91 to 99-00 22.24 12.89 13.73 6.37 13.73 5.02 80-81 to 99-00 22.47 16.03 16.53 7.49 14.00 4.88 Source: Analysis of Budgeted Expenditure in the Education Sector, MHRD, various years. The increase in growth is on account of resources in the plan account through the centrally sponsored schemes such as Operation Blackboard, Non-formal education and Teacher education in the middle of 1980s (Note 11). Lesser growth rates in the 1990s may be on account of lesser growth of income, fiscal imbalances of the states and structural adjustment programs, which jointly resulted in a cut in the education budget and eventually in elementary education growth as well. The same levels of elementary education expenditure viewed in constant process reveal much lower growth rates in 1990s (see Figure 2), the growth rate was mere 5 percent. The decline would be detrimental to the growth of the school system in Uttar Pradesh. While in many of the educationally progressing states the growth rate of plan expenditure was much higher during 1990s because of central assistance to elementary education. With regard to Uttar Pradesh, it suggests the state’s inability to absorb the center’s assistance through plan transfers under various schemes. Pressures of non- plan expenditures (basically salary component) have forced to reduce plan expenditures and thus growth of the system being hampered. Figure 2. Budget Expenditure on Elementary Education in Uttar Pradesh in current and constant prices. Source: Analysis of Budgeted Expenditure in the Education Sector, MHRD, various years. Another important dimension that needs to be looked into is for which of the items / activities, the expenditures are incurred. The intra-sectoral allocation or intra functional allocation of resources in elementary education in Uttar Pradesh suggests that the lion’s share of expenditures on elementary education goes to private aided schools (see Table 16). The highest share of government resources is allocated to private schools only in Uttar Pradesh for just around 15 % of private aided elementary schools in the state in 1993 (Note 12) compared to Kerala, where more than 60 % of the schools are private aided but the resources allocated to them are about 55 % of the elementary expenditures. It is argued that this kind of a situation is on account of the political economy of education in Uttar Pradesh (Muzammil and Kingdon, 2001). In a resource-poor state, the government resources are increasingly utilized by the private schools because of the state’s inability to divert the resources for government schools. As far as the states are concerned, the financial commitment and utilizing the resources efficiently for universalizing elementary education do not seem to be strong. Government investment in incentives for education will be more influential for the children from low-income families to enroll in schools. Nonetheless, it can be seen in Table 16 that hardly any expenditure is incurred for student incentives such as scholarships and textbooks. Table 16 Intra Sectoral Allocation of Public Expenditure on Elementary Education in Uttar Pradesh (in %) '90-91 '91-92 '92-93 '93-94 '94-95 '96-97 '97-98 '98-99 '99-00® '00-01(B) Direction Inspection Admn. 1.7 1.9 1.8 1.5 1.7 3.0 2.0 1.5 1.8 1.9 Assistance to Govt schools 0.2 0.2 0.5 0.3 0.2 0.3 0.3 0.2 0.3 0.3 Asst. to Private schools 90.9 91.8 90.4 91.0 88.4 91.2 87.1 92.9 85.8 91.8 Asst. to Local Body Schools -- -- -- -- -- -- -- -- -- -- Teacher Training 1.4 1.9 3.8 1.7 1.3 0.4 0.5 0.4 0.5 0.5 Non-Formal Education 1.2 2.2 1.6 2.2 0.8 2.1 2.0 0.9 1.78 2.14 Scholarships -- 0.1 0.0 0.0 0.1 0.0 0.0 0.0 0.0 0.0 Textbooks -- -- -- -- -- -- -- -- -- -- Other 4.7 1.9 1.9 3.4 7.6 3.0 8.1 4.1 9.9 3.3 Total (Rs in crs) 1210 1065 1085 1116 1423 2130 2252 3189 3132 3165 Source: Analysis of Budgeted Expenditure in the Education Sector, MHRD, various years. Even the National mid-day meal scheme, a centrally sponsored scheme, provides ration to the enrolled children in Uttar Pradesh as against the provision of cooked meals in other states. Further, it is noted that the scheme failed to set any target for enrollment and attendance from 1995 to 1999. It is because of poor governance, increased corruption, declining performance, and lack of concern for the poor that ineffective public programs and delivery in the state are manifest (Hasan, 2001). But, the scenario in other states is much different (see Table 17). Table 17 Distribution of Expenditure on Elementary Education in Major States in India in 1996-97 Direction Inspection & Admn Govt. primary School Asst. to non-govt primary school Asst. to LBs for primary education Teacher training Non-formal education Scholarships Text- books Other expend. Andhra P 0.53 3.84 9.20 76.92 2.66 3.69 0.07 -- 3.08 Bihar 1.62 93.90 1.02 --- 0.34 2.87 -- -- 0.27 Gujarat 0.69 -- -- -- 89.41 -- 0.02 0.89 8.99 Haryana 3.20 89.65 1.13 0.01 -- -- 1.82 3.52 0.67 Himachal 2.72 91.07 0.29 -- 0.48 -- 1.35 -- 4.08 Karnatak 0.20 0.45 0 88.35 0.65 -- 3.18 -- 7.16 Kerala 1.34 35.80 57.16 5.09 0.50 -- 0 -- 0.10 Madhya P 5.27 86.19 3.67 4.07 0.33 -- 0.04 0.32 0.11 Maharash 1.66 --- 0.06 96.55 0.76 -- -- -- 0.97 Punjab 2.83 96.26 0.76 0 --- -- -- -- 0.14 Rajastha 1.68 50.30 1.73 36.72 -- 0.58 -- -- 9.0 Tamil Na 0.06 61.81 31.94 0.42 --- -- -- 2.49 3.28 Uttar Pra 3.03 0.26 91.23 -- 0.44 2.07 0.03 -- 2.95 West Ben 1.54 0.06 92.83 --- 0.48 0.08 0.44 1.87 2.69 Source: Analysis of Budgeted Expenditure on Education, Ministry of Human Resource Development, New Delhi, 2000. So far, various dimensions of financing education per se and financing elementary education in particular in Uttar Pradesh have been discussed. Expenditure on elementary education in relation to the number of enrolled students is yet another important and comparable indicator across place and time. Per student public expenditure on elementary education in 1980-81 was a mere Rs.158 and increased at the rate of 14 percent in 1999-00 to Rs.2015. But the per student expenditures converted to real prices suggest that increase is about 5 percent over the same period, (see columns 6 and 7 of Table 15). Centrally Sponsored Schemes The role of central government in financing elementary education is limited in many of the states and in Uttar Pradesh as well. The education commission (1966) suggested that the central government should assume a larger financial responsibility for education by expanding central and centrally sponsored sectors. Since 1986 with the National Education Policy, central government support was organized into a number of centrally sponsored schemes (CSS). The rationale for central transfers to states is to promote regional equity in the education system. Besides plan and non-plan transfers from the central government, depending upon the priorities of the central government, it funds a number of schemes. These schemes are fully or partially financed by the central government and administered by state governments. The funding pattern of central and state government varies from scheme to scheme from 50% for co-educational non-formal education centers to 100% for girls non-formal education centres and 100% for operation blackboard (teaching-learning equipments), etc. Table 18 Centrally Sponsored Schemes in Elementary Education in Uttar Pradesh (in %) '92-93 '93-94 '94-95 '95-96 '96-97 '97-98 '98-99 Operation Blackboard 30.3 0.0 1.0 0.0 15.4 18.3 52.5 Non-Formal Education 37.4 69.6 88.0 87.9 77.8 34.1 27.9 Teacher Education (Note 13) 32.3 30.4 11.1 12.1 5.9 3.7 9.7 DPEP 0.0 0.0 0.0 0.0 0.9 43.8 9.8 CSS in Elementary (Rs. In lakhs) 4108 3651 3697 4593 5530 12430 13236 % of elementary in total 73.3 54.3 53.9 64.7 79.3 90.5 84.7 Total-CSS (Rs. In lakhs) 5603 6724 6854 7095 6977 13729 15619 Source: Education – Profile of States/Union Territories, Government of India, MHRD, New Delhi, 1998 & 1999. Centrally sponsored schemes 1985-90 1990-91 1991-92 1992-93 8th plan Education CSS 1213 276 476 606 2440 Elem. Education 630 155 355