Reducing wastage and improving productivity would be my top priorities. There’s urgent need to recast the entire budget formulation system. The current formula is based on spending rather than achievement under each head of expenditure.
For instance now the budget formulation process for education does not go beyond providing for salaries, construction, mid-day meals, printing of textbooks, and so on. We need to ask, what kind of learning will be the outcome of this spending?
As FM while determining allocations for education, I would first ask for a rigorous calculation of per-child costs with a breakdown of components at different levels and for different components of the system. This is urgently needed, since the Right to Education Bill is about to be passed, which provides for payment of per-child cost by government to private schools in return for teaching a percentage of underprivileged children. But, no one knows how the government will compute this cost.
My quick estimate is that the Union and state governments will spend close to Rs.80,000 crore on elementary education this year. Since 180 million children are enroled in government or government-aided schools, per-child expenditure in this country averages around Rs.4,500 per year in government schools. It is higher in industrialised states and lower in predominantly rural states such as Bihar.
The first question to ask is, what kind of education should Rs.4,500 per year (or Rs.375 per month) be able to buy? Is the student getting the taxpayers’ money’s worth?
The second question I would ask is, in which components is the money being wasted with near zero impact on productivity? How can non-performing schools and institutions in the system be made productive? Cut out what does not work, and strengthen what pays dividends. For this, I would need reliable data and evidence.
As finance minister of India I would focus on the outcomes of money spent. I would link increases in outlay to reforms that make expenditure more productive and effective.
(Madhav Chavan is the promoter trustee of Pratham, a well-known Mumbai-based education NGO)