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Centre, states to share right to education burden

Under pressure from various states, the central government has agreed to bear a greater burden of the cost of implementing the Right to Education Act

The Rs 231,000 crore price tag for the Right to Education (RTE) Act has reportedly been cleared by the Expenditure Finance Committee (EFC) and a 68:32 funding formula between the Centre and the states agreed upon, putting to rest the hugely contentious funding issue. The RTE Act, which came into effect in April 2010, promises free and compulsory education to all children aged between 6 and 14 years. 

The EFC approved the new sharing pattern on July 28, 2010; the Ministry of Human Resource Development (HRD) is now expected to approach the Union Cabinet for its approval.  

However, with many states demanding a 90:10 funding arrangement and Uttar Pradesh, Bihar and Bengal, among others, openly proclaiming their inability to fork out such huge funds for RTE, even this 68:32 ratio may not be well received.  

The HRD ministry was pushing for a 75:25 Centre-state fund-sharing arrangement. The states argued that RTE made state and local bodies accountable for implementation even though neither has the financial capacity. Some states like Uttar Pradesh charged that since the central government took all the credit for the legislation it should also ensure that funds are available. 

The Bordia Committee set up by the ministry in 2009-10 to harmonise the Sarva Shiksha Abhiyan (SSA) and RTE also argued for a greater financial share from the Centre. It said that a sharing ratio of 55:45 (for the current year) and 50:50 (in 2011-12) would be unfavourable to the states as they would have to practically double their allocation. 

The committee found that even at 2009-10 sharing levels of 60:40 for the Sarva Shiksha Abhiyan, as many as 14 states defaulted on their shares. Andhra Pradesh, Maharashtra, Rajasthan, Chhattisgarh, Himachal Pradesh, Orissa are among the defaulters. 

Previous estimates drawn up by the National University of Education Planning and Administration (NUEPA) -- the basis of financial planning for RTE provisions so far -- had pegged the requirement at Rs 171,000 crore. Revised estimates drawn up in June after factoring in teachers’ salaries under the existing Sarva Shiksha Abhiyan pattern, however, showed that implementation of the Act would cost the Centre a staggering Rs 231,000 crore over the next five years. 

Of this 231,000 crore estimate, Rs 24,000 crore will come through the Finance Commission’s allocation to state governments. The remaining Rs 207,000 crore will be shared by the Centre and the states based on a 65:35 formula. 

This will mean 16 out of 35 states and union territories won’t need to increase their education budgets to meet RTE commitments at all, Union government sources claim. 

Source: The Economic Times, July 30, 2010
            The Indian Express, July 30, 2010
           The Hindustan Times, July 30, 2010