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Chapter VII
ESTIMATION OF COST OF ELEMENTARY SCHOOLING CYCLE: PER
CHILD PER YEAR, TERMS OF EXPENDITURE IN ELEMENTARY
EDUCATION AND ITS SHARE
7.0.0
Introduction:
In the chapter six, it was shown that issue of quality improvement in primary
education has been in focus and cost estimates must include the cost of improving
quality.Creating a good learning experience which is being offered in the schools is
one of the reasons why children should stay in schools and complete the education
cycle. Issue of quality is intertwined with the issue of enrollment and retention in
primary education.However problem of quantifying the quality issue becomes more
complex due to inadequacy of data in this regard. In Uttar Pradesh, efforts in
addressing the quality issues under the Basic Education Project, District Primary
Education Programme and Sarva Shiksha Abhiyan have revolved around the quality
of infrastructure and support services, training of teachers, curriculum and teaching
learning material, textbooks, monitoring and supervision.
In the present chapter, cost of schooling at primary level would be presented.
The cost of education consists of private direct and private indirect cost of education
which is borne by the households. Institutional cost is the other component of the
costs of education, which can be further divided into current and capital costs. If the
private and institutional costs are added, social cost of education can be computed,
which constitutes the total resource cost of education. In this background, per child
per year cost of schooling and consequently cost of primary schooling cycle per
childwould be estimated. In addition to this, trends in real per capita/ per child
expenditure, major terms of expenditurein elementary education and their shares in
expenditure, would also be presented.This would prepare the basis of estimating the
financial requirements for universalising elementary education in the state of Uttar
Pradesh.
7.1.0 Cost of Primary Schooling: Global Estimates:
The cost of one year of primary education varies greatly from region to region
and country to country. The UNESCO Statistical Yearbook for Asia and the Pacific
2011 observes that as far as public-sector spending for education in Asia and the
Pacific is concerned, trends are mixed: with some countries increasing spending while
others are cutting expenditures. Public education expenditure as a percentage of GDP
of most countries in the region remains below the recommended 6percent threshold1.
1.
UNESCO and CONFINTEA VI, “Harnessing the Power and Potential of Adult Learning and
Education for a Viable Future: Belem Framework for Action”, Para. 14 a, p. 5. Available at:
www.unesco.org/fileadmin/MULTIMEDIA/INSTITUTES/UIL/confintea/pdf/working_docume
nt.
160
In most Asian and Pacific countries, public spending on education in 2008 ranged
from 2.0percent to 6.0percent of GDP. Public expenditure per student as a percentage
of per capita GDP indicates per student expenditure relative to available resources.
For primary education, the proportion ranged from 7.2percent in Bhutan (2009) to
26percent in the Maldives (2008). In 2006, India spent less than 10percent per student
as a percentage of per capita GDP at the primary level.
The unit cost of one year of primary education is expressed as a percentage of
per capita income, dividing public spending on primary education by the number of
students and expressing this number as a percentage of GNP per capita. This might
under- estimate the unit cost if many children are attending private schools. It would
be appropriate at this point to mention that as shown in the earlier chapters, in Uttar
Pradesh, demand for private schools has been on a rise, parents are choosingfee
charging private schools for their children and opting out of government schools.
7.2.0 Composition of Cost of Universalisation of Elementary Education:
Costs incurred for UEE have been divided into non-recurrent and recurrent
costs. Non-recurrent/ capital costs, consists of classrooms, equipment and ancillary
facilities expenditure. Recurrent expenditure consists of teacher salaries, grants
(includes development, maintenance training cost and teacher grants) and incentives
(includes midday meal scheme, uniforms, scholarships and textbooks). Teacher
salaries have the highest share of expenditure (more than 80 per cent of total
expenditure under SSA norms). Incentives have the next highest share in additional
costs out of the three main components of recurrent cost. Teacher grants, training
costs etc. form the third important component of recurrent expenditure.
Unit costs refer to recurrent and capital costs separately. They do not
incorporate the cost of teacher training or the cost of increased secondary school
places as more children will complete elementary education.
7.2.1 Trends in Per Capita / Per Child Expenditure:
The Ministry of Human Resource Development had published data on the
amounts of education expenditure per capita across states for 1989-90. In Uttar
Pradesh, Bihar and Madhya Pradesh, expenditure was between Rs.90 and Rs.99. In
the other twelve major states, the range was from Rs.135 to Rs.227 with an average of
Rs.166.
Although expenditure on education has been rising, the gap between real per
capita spending on education compared to other educationally advanced states
remains large and persistent. Per pupil expenditures in UP were also among the
lowest: in 1995-96, they were the third lowest among major states and only 40 percent
of the level in Kerala, Haryana, or Himachal2.Trends in elementary education
expenditure and total education expenditure per capita show a peak around 1989-90
2.
S. Bashir (2000) Government Expenditure on Elementary Education in the nineties. New Delhi:
The European Commission.
161
and 1990-91 and then again in 1998-99 and 2000-01, but it was due to
implementation of new pay scales and payment of salary arrears and should be
discounted.
There has been deceleration in growth rates in per capita/ per child
expenditure in the post structural adjustment period. Real elementary education
expenditure per child grew at 5.4 percent per year during 1975-76 to 1991-92 but the
growth rate declined to 4.5 percent during 1992-93 to 2000-01. In this period, in fact
UP was one of the few states that could slightly cushion the adverse impact of
structural adjustment on educational spending3.
7.3.0 Cost of Schooling: Government and Private:
Cost of education in Uttar Pradesh was analysed at the time of launch of Uttar
Pradesh Basic Education Project (1993)4. It has been found that dividing the non-plan
budget for 1991-92 by total enrollment in the primary schools gives an average cost
per year per student of Rs.533. Since around 97 percent of this budget is for salaries
and the student teacher ratios are officially 51:1 in primary 1-5 classes and 32:1 in
primary 6-8 classes, a child in the higher classes costs roughly 60 percent more than
those in the lower. Unit costs are around Rs.480 for primary 1-5 and Rs.768 for
primary 6-8.
Srivastava (2005)5, on the basis of Unicef survey showed that schooling costs
were higher for private than government schools, children in rural private aided
school had to bear the cost of Rs 1798 and Rs1660 in private aided school. Cost per
child in government school was about half of the above i.e. at Rs 811. This cost is
about annual wages of about a month. In the urban areas, average cost per child was
Rs 1411 and Rs 2001 in private aided and private unaided schools respectively. In
government schools, it was Rs 847 per child. It was shown that upper primary
education was more expensive in comparison to primary education. In rural areas, per
child cost was Rs 2194 and Rs 2059 in private aided and private unaided schools
respectively, while the cost in government school was Rs 1292. Unicef survey also
demonstrated that in urban areas, cost structure was the same but education was more
expensive in private aided and unaided schools. Per child cost was estimated to be Rs
2610 and Rs 2776 respectively, whereas cost per child in government school was Rs
1233.
3.
4.
5.
Ravi Srivastava (2005) ‘Public Expenditure on Elementary Education’, in Santosh Mehrotra,
P.R. Panchmukhi, Ranjana Srivastava and Ravi Srivastava (eds), Uncaging the Tiger
Economy.New Delhi: OUP
Financing Education in Uttar Pradesh, India: Uttar Pradesh Basic Education Project (1993)
R. Srivastava(2005) “The Impasse Broken: Mapping Change in Elementary Education in Uttar
Pradesh” in Santosh Mehrotra (ed.)‘The Economics of Elementary Education in India. 2006,
Sage Publications, New Delhi
162
Table-7.1
Annual Costs of Education and Comparison with Per Capita SDP and Daily
Wages
Average Annual
Cost as percent of SDP
Cost as Multiple of
Cost Per Student (Rs)
Per Capita
Daily Wage
Education level
Rural
Urban
Rural
Urban
Rural
Urban
Primary
321
1412
5.5
24.0
12.8
35.3
Middle
689
1803
11.7
30.7
27.6
45.1
Source: NSS 52nd round (computed) and Directorate of Economics and Statistics, GOUP
Quoted from Srivastava, Ravi (2005):‘Public Expenditure on Elementary Education’, in Santosh
Mehrotra (eds) The Economics of Elementary Education in India: The Challenge of Public Finance,
Private Provision and Household Costs. New Delhi: SAGE
The above table represents the household expense on children. Unicef survey
results show that annual per student cost for primary education was Rs 321 in rural
and Rs 1412in urban areas. It was 5.5 percent and 24 percent of the per capita income
in rural and urban areas respectively. At the upper primary level, it was 12 percent
and 31 percent of the per capita income in rural and urban areas respectively. These
costs rise with successively higher levels, although at each level the costs borne per
student are lower in the rural areas. At the primary level, the share of fees in total cost
is quite high as 28.5 and 42.2 percent in rural and urban areas respectively. At the
upper primary level, this share is 20.9 and 31.8 percent. About 20 percent of the total
cost at the elementary level was on uniforms. The bulk of expenditure was for ‘other
school related fees’, followed by expenditure on books/stationery, school
development fees and other school related costs for both rural and urban areas.
7.4.0. Per Student Expenditure on elementary Education in Uttar Pradesh:
In 2002, the average spending per student at the global level was about $44, or
8.5 percent of per capita GDP, which is lower than the average of 10-12 percent of per
capita GDP among low-income countries. In India, there was much variation across
states. Per student spending in India ranges from $16 in West Bengal to $68 in
Himachal Pradesh6.The variation across states is attributable to different conditions.
Three states which have high per student spending were HP, Kerala and Bihar. Their
high unit costs are due to different reasons- mountainous setting and remote schools
in HP, commitment to spend a high amount per child in Kerala, and low enrollment in
Bihar resulting in higher spending per child. The overall trend, however, is
encouraging as most states have increased per student spending between 1990 and
2000, except Haryana, Rajasthan, and Maharashtra which experienced a slight
decline.
6.
World Bank (2004), ‘Elementary Education Project Appraisal Document’ Report No 27703-IN,
Washington
163
It has been estimated7 that in Uttar Pradesh, expenditure on per enrolled
student at current prices (1980-81) was Rs. 157.90 and at constant prices, Rs 61.40.
InUttar Pradesh, per student expenditure has increased over the time from Rs.
158(1980-81) to Rs. 3140(2009-10). In the decade, 2000-01 to 2010, intra sectoral
allocation to elementary education has been increased, probably due to
implementation of SSA in the state.8According to another estimate, cost per student in
Uttar Pradesh is Rs. 2008 in government schools, Rs 1827 and Rs. 998 in private
aided and private unaided schools respectively.9
Public expenditure on elementary education in Uttar Pradesh through plan and
non-plan budget including central share of SSA is around Rs. 18817.52 crores in
2011-12 and as per DISE data, number of children enrolled is about 314.82 lakh.
Based on this, per child cost has been estimated at about Rs.5977.20 per year. In this
calculation, SSA funds released by the central government have been taken into
account. In addition to this, it is worth mentioning that this estimate of per child
expenditure does not include the funds allocated for the Mid-day meal programme.
Cost of schooling per child gives an estimate of cost of primary schooling cycle
assuming that there would be no stagnation and wastage. However it should have to
be kept in view that data and evidences suggest the occurrence of wastage and
stagnation at primary level, children do repeat in some grades, in spite of the policy of
no detention.
In this chapter, some of the estimates regarding cost of primary schooling at
the global and national level have been presented. In addition to this, estimates of cost
of primary schooling in Uttar Pradesh have also been presented. Composition of cost
of universalisation of elementary education in Uttar Pradesh, trends in real per capita/
per child expenditure have been analysed. It has been demonstrated that cost of
schooling is different in government and private schools are different and relatively
higher in private schools. There is a cost implication for the households. In this
background, per student expenditure on primary and upper primary schooling in Uttar
Pradesh has been estimated and presented in this chapter. It has been estimated that
per child expenditure, per year is aboutRs.5977.2 per year (including the expenditure
incurred through state budget and central releases under SSA but excluding Mid-day
Meal programme expenditure),Rs. 29886 for primary education cycle and Rs. 17931
for upper primary cycle. On this basis, financial implications of universalisation of
elementary education in Uttar Pradesh would be estimated in the following chapter.
7.
8.
9.
Mohd. Muzammil (1985) ‘Financing of Education in Uttar Pradesh’, Ph.D. Thesis, University of
Lucknow, Later published in a book form FINANCING OF EDUCATION, Ashish Publishing
House, New Delhi, 1989.
Geetha Rani, P. (2013) ‘Report of the Research Study on Financing Elementary Education in
India: Fund Flow and Utilization of Resources in Elementary Education’, NUEPA, New Delhi
G. Kingdon (1996) ‘The quality and efficiency of private and public education: A case-study of
urban India’. Oxford Bulletin of Economics and Statistics, 58(1), 57-82.
164
References:
1.
UNESCO and CONFINTEA VI, “Harnessing the Power and Potential of Adult
Learning and Education for a Viable Future: Belem Framework for Action”,
Para. 14 a, p. 5. Available at: www.unesco.org/fileadmin/MULTIMEDIA/
INSTITUTES/UIL/confintea/pdf/working_documents
2.
S. Bashir(2000) ‘Government Expenditure on Elementary Education in the
Nineties’. New Delhi: The European Commission.
3.
Ravi Srivastava (2005) ‘Public Expenditure on Elementary Education’, in
Santosh Mehrotra, P.R. Panchmukhi, Ranjana Srivastava and Ravi Srivastava
(eds), Uncaging the Tiger Economy. New Delhi: OUP
4.
Financing Education in Uttar Pradesh, India: Uttar Pradesh Basic Education
Project (1993)
5.
R. Srivastava (2005) “The Impasse Broken: Mapping Change in Elementary
Education in Uttar Pradesh” in Santosh Mehrotra (ed) ‘The Economics of
Elementary Education in India. 2006, Sage Publications, New Delhi
6.
World Bank (2004), ‘Elementary Education Project Appraisal Document’
Report No 27703-IN, Washington
7.
Mohd. Muzammil (1985) ‘Financing of Education in Uttar Pradesh’, Ph.D.
Thesis University of Lucknow, Later published in a book form FINANCING
OF EDUCATION, Ashish Publishing House, New Delhi, 1989.
8.
P. Geetha Rani (2013) ‘Report of the Research Study on Financing Elementary
Education in India: Fund Flow and Utilization of Resources in Elementary
Education’, NUEPA, New Delhi
9.
G. Kingdon (1996). ‘The quality and efficiency of private and public education:
A case-study of urban India’. Oxford Bulletin of Economics and Statistics,
58(1), 57-82.
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