Reduction in development budget for education

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Reduction in development budget for education

EDITORIAL (July 11 2010): The government is more focused on current expenditure in the education sector, than on the allocation earmarked for the development budget 2010-11, though public sector expenditure in Pakistan's education sector, in terms of percentage of GDP, remains the lowest in South Asia.

There has been a progressive decline in budgetary allocation for education since 2006-07 (it was 2.5 percent of GDP in 2006-07, 2.4 percent in 2007-08, 2.1 percent in 2008-09 and only 2 percent in 2009-10), which is reflective of the degree of primacy attached to this single most critical sector that also contributes towards poverty alleviation - the avowed goal of almost all the governments.

Sources in the Education Ministry have informed Business Recorder that the government has raised budgetary allocation for education from Rs 31.56 billion to Rs 34.50 billion in the 2010-11 budget although, the development budget for the sector has been slashed from Rs 21.3 billion to Rs 20.8 billion. Further, the government has allocated Rs 34.50 billion, against the revised budgetary estimates of Rs 31.53 billion.

The cut in development spending and increased current expenditure allocation, in a way, is reflective also of the imbalance in prioritising the immediate needs of the sector and its long-term development, on which essentially depends the realisation of a knowledge-based economy.

Under the Education Policy 2010, the government is committed to increasing the education budget from its current level of 2 percent of GDP to 7 percent by the year 2015, though the policy does not spell out, in clear-cut terms, the implementation mechanisms the government plans to adopt for achieving the ambitious target.

At issue is the increasing dichotomy in budgetary allocations and their productive utilisation that can benefit the economy. The government has allocated Rs 20.8 billion in the PSDP for education, against Rs 21.3 billion in the FY2009-10, which represents a 10 percent cut. In the PSDP 2010-11, Rs 5,140.9 million has been allocated for education against Rs 5,500 million in 2009-10.

Similarly, a cut of Rs 2,598 million has been made in the Higher Education budget. The reduction will obviously make an across-the-board impact on the implementation of Higher Education projects. Pakistan already ranks way below in the international scale of higher education, with an enrolment rate of only 2.9 percent. (Ranking of other Asian countries, such as India and South Korea is 10 percent and 68 percent, respectively.) Yet another factor of critical importance is the relatively low quality of education imparted in Pakistan, particularly in the public sector, which is one of the reasons why not even a single Pakistani university is ranked among the world's top 500 universities.

(What became of the former government's plan to establish nine world-class universities?) Secondly, studies conducted by international institutions have established that the literacy rate and per capita income of a country are closely co-related.

Pakistan with its relatively low literacy rate has a per capita income that is claimed to be over 900 dollars, while Malaysia and Brazil, with literacy rates of 78 percent and 81 percent respectively, have per capita incomes of $2,520 and $2,940 (2004 figures). Thus, it always pays rich economic dividends to invest in the education sector, as in other productive sectors of the economy. Investing in human capital holds the key to a country's long-term progress.

Business Recorder [Pakistan's First Financial Daily]