RESOURCES FOR EDUCATION
THE ARGUMENT 1.1 After a review of the data on expenditure on education since the First Plan, the report of the Kothari Commission, the Eighth and the Ninth Finance Commissions and of the National Policies on Education, 1968 and 1986, the NPERC makes its premises clear namely:
(i)Education has been treated as residuary sector and given lower priority in allocation of funds.
(ii) Though education has been in the Concurrent List of the Constitution since 1976 it remains primarily a state activity.The contribution of the Central Government in financing education is small.
(iii) The fees structure has virtually remained unchanged for the last, four decades and educational developments has come to be more and more dependent on availability of Government resources.
(iv) The Plan expenditure on Education as a percentage of total Central and State Plan Expenditure has been falling over the successive Five Year Plans. There was, however, a marginal increase during the Seventh Plan.
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(v) The share of elementary education in Plan outlay has come down from 56% in the first Five Year Plan to 29%in the Seventh Plan. The share of secondary education had remained somewhat stable. The share of higher Education (University & College Education) has expanded over the years from 9% during the First Plan to 22% in the Fifth Plan and declined somewhat in the next two Plans.
(vi) Based on the recommendations of the Kothari Commission, the National Policy on Education 1968 laid down that the investment on education should gradually increase to a level of six percent of National income . Noting that, the actual level of investment was far short of 6%, NPE, 1986 expressed a resolve to reach this level and stated that it would be ensured that from, the Eighth Five Year Plan onwards the investment on education will uniformly exceed six percent of the National Income. The share of public expenditure on Education in GNP which was 0.7% in 1950-51 had reached a level of 3.2% only, in 1985-1986. The Committee, therefore, feels that much leeway has to be made for realising the level of 6%.
1.2 Save premise No.(ii) the other premises are unexceptionable. Though education was included in the Concurrent List in 1976 it was only in NPE, 1986 that a concrete definition was accorded to the concept of concurrency.Expounding the view that concurrency signifies a partnership between the centre and
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the States which is at once meaningful and challenging, and making it. clear that the role and responsibility of States in regard to education will remain essentially unchanged, the NPE, 1986 laid down that. Union Government, would accept a larger responsibility to reinforce the national and integrative character of education, to maintain quality and standards (including those of the teaching profession at all levels), to study and monitor the educational requirements of the country as a whole in regard to manpower and development, to cater to the needs of research and advanced study, to look after the international aspects of education, culture and human resource development and, in general, to promote excellence at all levels of educational pyramid through out the country. Subsequent to NPE, the Central Plan outlay for Education increased significantly from Rs.351.96 crores in 1986-87 to Rs.825 crores in 1987-88. Most of the incremental amount was released to the State Governments. Had the investment step up been sustained after 1987-88 the devolution of resources to the States would have been far higher. Therfore premise (ii) does not fully reflect the trends since NPE-1986.
1.3 Proceeding from the premises set, out in para 1.1 the Committee suggests the following strategies for additional resources mobilisation
(i) The level of 6% of GNP was suggested over a quarter of century ago and since then considerable changes have come about in the economy. Therefore, in the changed context, a higher proportion of GNP should go into
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education.
(ii) All technical and professional education may be made self-financing with appropriate support to the students by way of student loans.
(iii) Increase by higher education institutions of tuition fees and fees charged for specific purposes such as laboratory fees, library fees etc.
iv) Mobilising institutional and finance for promotion of research in universities a for creation of infrastructures such as buildings, hostels, staff quarters, etc.
(v) Increase in funds provided for scholarships by the Central Government.
(vi) Mobilisation of community contribution.
1.4 All the components of the strategy outlined above have no policy implications. It may be stated that Para 11.4 of NPE1986 laid down that from the Eighth Plan onwards it would be ensured that outlay on education would uniformly exceed 6 percent of National Income.
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ANALYSIS OF RECOMMENDATIONS
Strategies for Raising Resources
Recommendation No. 313 2.1 The Committee suggest an upward revision of the level of the investment education in relation to GNP. The recommendation is based on the fact that the level of 6% was worked out quarter of a century ago and since then there have been considerable changes in the economy. Though 6% level of investment expresses the national resolve reiterated again and again the expenditure on education by state and Central education departments as a proportion of GNP has increased from 0.72% in 1950-51 to 3.47% in 1989-90. The details are :
Year Public investment in Education as proportion of GNP
1950-51 0.72
1960-61 1.57
1970-71 2.23
1980-81 2.35
1985-86 3.21
1989-90 3.47
2.2 There is still much leeway to the made to reach the goal of 6% However, it may be stated that para 11.4 of NPE, 1986 has laid down that from the Eight plan onwards it would be ensured that outlay on education would exceed 6% of national income. Therefore the NPE does envisage investment of more than 6% of nation income.
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Recommendation No. 314-322 2.3 The recommendations propose that:
(i) All technical and professional education may be made self-financing with appropriate support to the students by way of student loans.
(ii) Increase by higher education institutions of tuition fees and fees charged for specific purposes such as laboratory fees, library fees, etc.
(iii) Mobilising institutional finance for promotion of research in universities and for creation of infrastructures such as buildings, hostels, staff quarters, etc.
2.4 The recommendations have no policy implications and can be expected to be taken note of by the agencies concerned. They are essentially a restatement of para 11.2 of NPE-1986.
2.5 As far as technical education is concerned, the AICTE has been considering the question of raising the fees so as to make technical education self supporting. One of the functions of the All India Council for Technical Education (AICTE) is to fix norms and guidelines for charging tuition and other fees by technical institutions. The Council observed that the present annual fee collected on an average from an engineering college student works out to Rs.533/- and from a diploma student to Rs.310/-. The fee collection thus contributes to just 5% of the total recurring expenditure which is estimated to be roughly Rs.12,000/- per annum for degree courses and Rs.8000/- for diploma courses. The Council was of the view that there is an
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urgent need to bring fees in technical institutions to a realistic level, so that there is some reasonable relationship between the fees charged and the actual cost of training. It also noted that the difficulty.in raising the fee is that the paying capacity of an average Indian is limited and if the fees are raised beyond the paying capacity of an average Indian, some loan arrangements to students may have to be made. The Council appointed a Task Force to go into these details and to make recommendations in this regard. The Task Force inter alia recommended that the fee structure in Government, Government aided and self-financing institutions has to be changed and the tuition fee to be collected from the students should be 20%, 30% and 70% respectively of the annual recurring expenditure. The Task Force has further recommended that on enhancement of tuition fee more scholarships should be provided to meritorious students and students belonging to the economically backward families. It has also been suggested that soft loans with nominal interest rate should be provided to students studying in technical institutions.
2.6 In order to generate resources for technical institutions apart from fee collections, the Task Force has suggested geneation of income from consultancy, research, seminars, symposia, continuing education programmes, sale of books, video programmes, films and royalty from technology transfer, etc. The AICTE has endorsed the recommendations of the Task Force.
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2.7 The question of increase of tuition fees and generation of resources by technical institutions was also considered by the Central Advisory Board of Education. The Board also recommended that the fee structure in technical institutions should be enhanced in stages so as to augment resources. It has also suggested that a realistic maximum limit of fees should be prescribed by the AICTE for self-financing engineering colleges and polytechnics. Necessary action in this regard is being taken by the AICTE.
2.8 In the meantime, the Government of India has approved the proposal of the ITT Council for enhancement of tuition and other fees in respect of new entrants from the academic year 1992-93 in the IITs. However, this increase will be very modest.
2.9 It may, however, be mentioned that raising of fees in technical institutions is a sensitive matter and needs consultations with State Governments, parents and political leaders to generate public opinion in this regard. However, concrete steps should be gradually taken to make technical and higher education self financing.
2.10 Enhancement of tuition fees has also to be linked with raising of number and amount of scholarships as well as granting of liberal loans at reduced rates of interest to students studying in technical institutions.
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2.11 Under the UGC Act, the Commission has powers to specify the scale of fees to be charged in consultation with the universities through regulations. However, the UGC has not notified so far any Statutory Regulations in this regard.
2.12 The NPERC has also suggested institution of chairs by industry. It is noted that over the past few decades several organisations have instituted Chairs of professorship for specific projects in the various IITS, IIMs and other insitutions. This activity needs to be extended further by other organisations.
2.13 The NPERC while admitting many problems involved has recommended that institutional loans are indispensable. The Commercial Banks already provide need based finance under their existing 'Educational Loans' Scheme as a part of their priority sector lending activity to students who wish to undertake any type of certificate/diploma/graduate/post-graduate courses, subjected to the guidelines issued by the Reserve Bank of India (RBI). However, there is room for improving the scheme.
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Scholarships
Recommendation Nos. 323 to 326 2.14 The recommendations do not have policy implication.
2.15 The recommendations relate to provision of appropriate scholarship to the students belonging to economically weaker sections who go in for higher education, enhancement of budget provision on the Central Sector for scholarships, rationalisation of the whole programme of awarding scholarships,discontinuation of the scheme of schcolarship in Approved Residential Secondary schools and corresponding increase in number of scholarships for meaningful programmes of upgradations of merit of SC/ST student and administration of the scholarship being left totally to the States with necessary provision in the State Plan outlay on an earmarked basis for the better implementation of scholarship scheme with more direct and responsible involvement of the States.
2.16 The following schemes are implemented by the Department of Education.
(i) National Scholarships scheme (plan) : scholarships recently increased to 38, 000 annually from 33, 000.
(ii) Schemes of Scholarships at Secondary Stage for talented Children from Rural Areas (plan) : recently increased to 43, 000 awards from 38, 000. (iii) Upgradation of Merit of SC/ST Students (plan) : 1,000 awards annually.
(iv) Grant-in-aid acheme of schcolarships to students from
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Non-Hindi speaking States/UTs for Post-Matric studies in Hindi (Non-Plan) : 2,500 awards annually.
(v) The Scheme of Scholarships in Approved Residential Secondary Schools already discontinued and hence Recommendation No. 325 stands implemented.
2.17 All Scholarships under these Schemes excepting (iii) and (iv) are awarded on merit-cum-means basis. There is no income ceiling in respect of Schemes at Sl. No. (iii) and (iv); for others the ceiling is Rs.25,000 per annum.
2.18 Enhancement of funds for Scholarships is dependent on resource allocations for education in the Eighth Plan.
2.19 The functioning of the Scheme of Scholarships at Secondary Stage for Talented Children from Rural Areas is already under detailed review. The scheme of Scholarships to students from non-Hindi Speaking States/UTs. for post-matric studies in Hindi has since been evaluated by Central Institute of Hindi Agra and the scheme is being revised accordingly, Review of Schemes is a continuous process.
2.20 The schemes at (i), (ii), (iii) and (iv) are being implemented by, State Governments/UTs. which are also responsible for selection of students and award of scholarships. Major portion of the expenditure on the implementation of National Scholarships Scheme and Scheme of Scholarships at Secondary stage for Talented Children from Rural Areas is met by the State Governments., During Eighth Five Year Plan State Governments will meet expenditure upto the 1991-92 level of expenditure. Central Government liability is to meet expenditure over and above 1991-
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92 level. The financial liability of the State Government on the schemes is about 90% of the total expenditure.
2.21 The scheme of up gradation of merit of SC/ST students and Scheme of Scholarships to students from non-Hindi Speaking State/UTs. for post-matric studies in Hindi are fully financed by the Central Government.
2.22 As States are already associated in the implementation of the scheme further changes are not considered necessary.
- No Policy implication
- States already associated in implementation of Scholarship schemes; no changes necessary
Other Means of Raising Resources
Recommendation No. 327
2.23 In this recommendation NPERC offers a number of suggestions for raising resources for education some of which have been made in Para 11.2 of NPE, 1986. Many of these suggestion are in keeping up with the recommendations made by the Working Group on Education for Eighth Five Year Plan.
- No Policy implication
- Implementing agencies could be expected to act on these recommendations
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DEVELOPMENT SINCE NPE 3.1 Consequent upon the approval of NPE, 1986 by Parliament, the Central Plan outlay for education was enhanced substantially from Rs. 351.96 crores in 1986-87 to Rs.825 crores in 1987-88. Thereafter the increased have been nominal. The Plan outlays for Education in the State sector was also increased from Rs.763 crores in 1986-87 to Rs.1458 crores in 1989-90.
3.2 Followings are the Annual outlays for Education in the Central/State sectors since NPE, 1986:
Plan Non-Plan
(Rs. in crores)
Centre State Centre State
1986-87 351.96 763.22 307.14 6738.45
1987-88 825.00 921.63 383.23 7599.57
1988-89 835.50 1125.83 746.52 8736.25
1990-91 920.00 1386.20 794.04 N.A.
1991-92 1032.00 1632.71 774.02 N.A.