Gaps and challenges in education spending

Need more resources to invest in education to enrol out-of-school children

Pakistan adopted six Millennium Development Goals (MDGs), and education is one of them: to achieve 100 per cent primary enrolment with high retention and gender parity by 2015. The deadline is coming close but statistics show that we are unable to meet the targets we committed to. According to estimates from 2014, the Primary Net Enrolment Rate is 57 per cent against the target of 100 per cent, while gender parity in education access is 0.88. The survival rate at primary level is 67 per cent, which implies that 33 per cent students could not complete primary education. With this gloomy picture of the education sector in Pakistan, it is important to glance over public education financing and to find spending patterns that indicate inefficiencies.

First of all it is necessary to check whether we are allocating enough financial resources to education.

Currently we spend two per cent of GDP, and 20 per cent of our total budget is dedicated to education spending as of 2014 and 2015 (previously it was 10 per cent of the total budget). What we want to look at is whether this is enough to cater to the needs of the education sector. In Pakistan, 6.2 million children are still out of school (2014). The infrastructure condition of existing schools is not satisfactory, and about 40 per cent of the educational institutions don’t have basic facilities such as electricity, water, toilet and boundary wall; 10 per cent of school buildings in the country are in dangerous condition.

The learning outcomes of students are not up to the mark, and according to a recent calculation by Alif Ailaan from data of ASER, 48 per cent class-5 students are unable to read Urdu and English meant for class-2. This means we not only need more schools and infrastructure, but once we enrol 6.2 million out of school children we need to work on the quality of education. Furthermore, we need to rationalise the allocation for different levels of education (primary, secondary and tertiary) and function wise allocation like salary, non-salary allocation.

The major portion of the education budget is being spent in recurrent expenses: more than 80 per cent and a meagre 20 per cent is set aside for development expenses. This limits investment in new infrastructure and capacity building of the education sector.

An analysis of the split of current budget exposed that provinces are spending around 90 per cent of their budget on salaries, and only 10 per cent on non-salary expenses. Non-salary expenses comprise repairs and maintenance (furniture and fixture and building structures), rents, utilities, communication and physical assets. Keeping in mind the afore mentioned facts about missing facilities and building satisfactory conditions, is this lower spending on non-salary expenses justified?

Moving forward, lower allocation is not the only problem, its ineffective utilisation is another issue that needs to be addressed. The analysis of data from PIFRA SAP System in ISAPS report tells that the management of educational institutes failed to spend all allocated funds, and that the phenomenon of underspending is severe in case of development funds than funds for recurrent expenses. So, this is another area needs to be explored by the researchers to put their finger on the real reason for this pattern.

Some of the studies in selected areas exposed reasons like complicated access to non-salary budget, procurement issues, slow tendering, lack of staff to handle accounts and late arrival of funds. Moreover, some schools have to depend on other schools that have access to Drawing and Disbursing Officers (DDO).

Discussion on education budget without evaluating level wise budget shares is incomplete.

The major share of the budget is going to the primary level (according to the PRSP budgetary expenditures) followed by the secondary and tertiary level. But unfortunately the per-pupil expenditure at primary level is lower than the secondary level. Again the question arises for policy makers to review the share of primary level per-pupil expenditure and assist students in successfully transitioning from primary to secondary level.

The budget making process is also marred with errors, and not efficient enough to capture the true/exact needs of the coming year. Budget making process is important enough to influence the allocation for different sub-heads and then ultimately influencing the educational outcomes. Analysing the budget making process in KPK and Punjab identifies a list of weaknesses. The majority of the districts did not receive Budget Call Letters and budget calendars on time. They don’t prepare statement of excess and surrender and Schedule of New Expenditures (SNE). That is the reason behind a lot of revisions in budgetary estimates and supplementary grants since SNE is the estimation of expenditures for the required new staffs for existing and new schools.

A large number of districts don’t propose new development projects largely due to the lack of skilled budget staff and capacity issues which hinder an efficient budget making process. The pre-budget consultation is also very weak, indicating low stakeholder participation and limited criticism on budget hence ultimately the budget fails to reflect the public demands.

So, it is time to evaluate critically budgets and address the shortcomings to get desired results. Because, spending on education will ultimately lead to GDP growth (up to 2.5 per cent) and a permanent shift towards better socio-economic development.