24,000 crore funds granted for RTE implementation

Updated on: Friday, February 26, 2010

New Delhi: The Right to Education (RTE) Act was although announced boisterously by the Human Resource Development (HRD) Ministry but the lack of funds to support the generous plan was making the government think over its modus operandi.

But now, with the announcement of the 13th Finance Commission allocating Rs.24,068 crore for Sarva Shiksha Abhiyan (SSA) to all the states for the next five years, the HRD ministry as well as the states are experiencing a windfall for elementary education.

The demand for grants made by the HRD ministry was also fully accepted by the commission. The Commission, although is yet to chalk out the funding pattern for the RTE Act, but it recognizes that its implementation requires more funds.

It is clear that SSA will be the main vehicle for implementing the RTE Act. The report highlights two things about education. Firstly, it is for the first time that the 13th Finance Commission has allocated Rs.24,068 crore of funds for all the states unlike that of the 12th Commission which allocated funds for only eight states.

Equivalent of 15% of the assessed requirement, the funds, which is to be distributed to the states for the next five years, is part of the equalization grant to all of them.

The funds promise to incur recurring expenditure, which SSA is expected to bring in terms of salary, training and similar other heads except the capital expenditure, which does not fall under its reign.

Taking into account the inability of 14 states to contribute to their share of 40% for SSA last year, it is now improbable that they would be able to increase it to the required 45% from the next fiscal. However, it is expected that deploying more funds for the states might help solve this problem.

The Commission has made it very clear right from the start that although it has been generous in allocating the huge amount but this should not be used as a substitute for current expenditure of states.

It has stipulated that the expenditure (excluding Rs.24,068 crore) should grow by at least 8%. The second report of the Commission on the education scenario of the country however, diverges from the Planning Commissionâ€™s argument that states are in abundant with funds for SSA and even RTE.

The Commission recognizes the fact that implementing RTE is a mammoth task and it necessarily requires considerable increase in the funding requirements for elementary education.

The report highlights the differing views of the HRD ministry and Planning Commission on RTE funding. While HRD has projected a requirement of Rs.1.73 lakh crore, the Planning Commission panel brought it down to Rs.1.44 lakh crore.

The states' demand, on the other side, to share 2% education cess has not been accepted. Education cess on indirect tax will be subsumed under the basic rate of central Goods and Services Tax.

However, education cess on direct tax may continue. However, states will still not get anything. Furthermore, Finance Minister Pranab Mukherjee announced on Friday that the union budget for the next fiscal, recording an increase of Rs.4,236 crore from the previous year, has pegged an outlay of Rs.31,036 crore (Rs.310.36 billion/ $6.7 billion) for school education.

The minister said a lot of this money would go for the implementation of the RTE Act. "The act will provide good quality and equity education," Mukherjee said while presenting the budget in the Parliament.

24,000 crore funds granted for RTE implementation

More Education news