Budget 2022: Expect Centre to hike allocation for education sector by 10%, writes head of Apeejay education society

Image used for representation. (Photo credit: sfugradsociety.ca)

The pandemic has shifted the focus of the government towards education and healthcare in a certain way. While recovery is still a major concern, focusing on healthcare and education as well as infrastructural development would be the key cornerstones of India’s growth. An increase in budget allocation, measures to reduce the digital divide, checking the menace of school dropouts, education and skill development, better infrastructure, enhanced employment opportunities and faster implementation of the National Education Policy are some of the areas that should be prioritised in the upcoming budget.

Allocation towards education was further reduced to Rs 85,890 crore in the revised stage (down 14%). The Education sector seeks higher allocation in overall budget.Here are some of the key desired areas to be focused upon:

• Increase overall budgetary allocation

Last year, the Government slashed its allocation towards Education in the Annual Budget by 6 per cent, amounting to a total allocation of Rs 93,223 crores, against Rs 99,311 crores in the year before that. Further, it was reduced to Rs 85,890 crore in the revised stage (down 14 per cent). The education sector seeks higher allocation in overall Budget, and this year, we expect the Government to increase allocation by around 10 per cent.

• Implementation of NEP

The recently launched New Education Policy should now get implemented with clear cut guidelines and budget allocated for it to be executed on the ground.

It’s not just a Budget for the faster implementation of the NEP, rather there should be proper milestones to be set and steering committees to be made in order to ensure its gross implementation across center and states.

• Reduction of GST on educational services

The pandemic’s impact on the public education system has increased reliance of all students on supplementary sources of education that are provided by private organisations. Traditionally, such sources have been categorised under ‘Educational Services’ and are taxed at 18 per cent under Goods & Services Tax (GST). The Government should consider revising the GST rate for this category to 5 per cent, thereby easing the financial pressure on the students and parents, particularly those from lower- and middle-class families.

• Improving accessibility and last-mile connectivity

The government has taken laudable steps in strengthening the digital backbone of the country. However, the problem remains is the last mile household connectivity due to the unavailability of devices to a large chunk of the population. To address this issue, free or very-low cost Wi-Fi infrastructure should be set up in more cities and districts across the country.

Money which is spent on giving scholarships and devices to students should be automatically considered as CSR budget.Besides, we need to explore some low-cost device options to access the internet that enables education through platforms like Zoom, Google classroom or the virtual education platforms created by the government. Different government organisations and private bodies should be encouraged to sponsor these devices to students. Money which is spent on giving scholarships and devices to students should be automatically considered as CSR budget.

Further, the government should consider device public banks in line with the model of public libraries.

• On accumulation of surplus for educational societies

The cost of commercial loans remains prohibitively high with rate of interest ranging from 16 per cent to 17 per cent – often beyond the paying capacity of the Societies/Trusts.

In this circumstance, the educational Societies/Trusts depend primarily on their own internal generation of surplus and accumulation thereof to finance continuing renovation/modernisation (class rooms/laboratories etc) to stay afloat, abreast of times and their planned expansion/up-gradation, if any. Here again they are hamstrung by the cap fixed for the Society or Trust to accumulate surplus not beyond 15 per cent in any year.

A stage has come now for the government to make a review so that a well-intended cap should not degenerate to be a bottleneck for the genuine educational societies in the genuine educational pursuits. One approach could be to separate the grain from the chaff by making a policy distinction in favour of Societies who have come to stay with a proven track record of say 15 years. For such 15-year-old societies, after a review, the cap of 15 per cent may be applied on a 5 year moving average basis (to take core of lean years of high expenditure low surplus) rather than on a yearly basis. In the next place to encourage and empower such Societies/Trusts they may be permitted an additional 10 per cent surplus on a strict condition of its investment in government approved bonds to let such societies develop a nest egg.

For 15-year-old societies, after a review, the cap of 15% may be applied on a 5 year moving average basis rather than on a yearly basis.• Scholarships and student loans

Although the government has done a lot towards introducing scholarship schemes, it needs to take necessary steps in increasing the accessibility to these scholarship schemes each year. Different scholarship schemes should be introduced as part of the government budgets or as part of the CSR budget of companies or organisations.

Besides, the government should certainly explore some options for modifications in students’ loan repayment structure. It can draw inspiration from some of the best practices across the world that eases the life of students who seek education loans. The ongoing system of student loans is based on commercial terms, primarily.