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Why the private sector
is so important
By Naveed Ahmed

Various governments have tried to fulfill the constitutional requirement to ensure that people have access to primary and secondary education in Pakistan No less than 23 different policies, plans, programs and schemes have been initiated by different governments since 1947, and in all of them the set targets were not achieved. This failure demands a thorough review of existing processes and procedures.

The education sector in Sindh, as well as in Pakistan, has been plagued by problems like low budget allocations, disproportionately large allocation on recurrent expenditures like salaries, a dismal utilization level (see table 1) of the money set aside for development, and a low level of productivity among the education department's administrative staff as well as teaching cadre.

Figures in million

Table 1

Year
Budget utilized
Total enrolment % Increase in
expenditure
% Increase in enrolment
1996-97
8,873
3.158
-
-
1997-98
10,317
3.187
16
0.91
1998-99
10,400
3.089
0.80
-3.0
1999-00
11,602
3.057
11.5
-1.0
Total loans/grants provided during same period Rs. 662.225 million
Source: Education sector reforms: Action Plan (2001-2004) SEMIS Census Report

Given this situation, the private sector has a significant role to play. But it is argued - and to some extent this is correct - that the private sector is concentrated only in Sindh's urban areas and that it charges fees that are often unreasonably high. However, abandoning market forces should not be a policy option, instead the solution lies in strengthening and helping the private sector, and in the government busying itself in a more regulatory role correcting market distortions.

Often policymakers have believed that simply increasing the education budget is enough to increase enrolment and standards in Pakistan or that they have overestimated its role in such matters. For example, investment in primary education in Pakistan almost quadrupled from Rs 9.563 billion to Rs 38.674 billion in the 90s but the enrolment rate did no go up. At the beginning of the 90s, it was 69 per cent and by the year 2001 has risen to 74 per cent.

Table 1 shows Sindh's education budget, how much of it was utilized and its effect on enrolment. Despite an increase in the budget by 28.3 per cent, enrolment fell - by three per cent. Furthermore, the dropout rate, which was 47 per cent in 1998 increased to 51 per cent in 2001 (Social Policy and Development Centre, Annual Report, 2003).

Table 2  
Figures in million
      Total education budget     Actual expenditure     Utilization (%)    
Year Total Dev. Recurrent Total Dev Recurrent Total Dev. Recurrent
1998-99 16,286.73 14.16 85.84 10,173.739 0.76 99.24 62.47 3.35 72.22
1999-00 14,250.78 8.65 91.35 11,601.862 1.54 98.46 81.41 14.46 87.75
2000-01 15,078.24 8.44 91.56 12,332.492 1.24 98.76 81.79 12.00 88.22
2001-02 14,337.69 8.02 91.98 14,427.00 2.06 97.94 100.62 25.83 107.15
Avg 9.8 90.18 1.40 98.60 81.57 13.91 88.83
Source: Ministry of Education (Government of Pakistan), UNESCO  

Another problem is in the distribution of Sindh's education budget. On average, only 9.5 per cent of the budget is allocated for development activity with over nine-tenths going to recurring or non-development expenditure. And, even this meagre proportion is often not utilized. In fact as the table suggests, a mere 15 per cent of the development budget has historically been utilized.

This low absorption capacity clearly shows that even if the government increases the education budget in absolute terms, much of that money will not be utilized. This happens because the system of disbursement and use has structural faults which first need to be removed. Unless this is done, the goal of education for all (EFA) will remain a distant dream.

Since 1951, no less than seven education plans have been drawn up and on each occasion the target set for primary enrolment has not been even close to achieved. In fact, the target enrolment rate set in the Sixth five-year plan (75 per cent) for the period 1983-88 has yet to be achieved.

Let's take a look at the private sector now. At present there are about 30,000 private educational institutions in Pakistan with an enrolment of approximately three million students. In Sindh, according to 1999-2000 Census of Private Educational Institutions in Pakistan, there were 2,572 privately-owned primary schools with a total enrolment of 0.935 million students.

Figures (see table 3) suggest that every third child of primary school-going age is enrolled in a private school. This can be explained by the fact that while there are far fewer primary schools the average size of their student body is much larger than that of a government school. The majority of private schools are concentrated in Hyderabad and Karachi districts and they have almost 85 per cent of the total primary school enrolment for Sindh.

Table 3  
Figures in million
Public schools Private schools Ratio of public to private
Total enrolment 2,348,684 935,292 2.5
Total schools 39,176 2572 18
Enrolment per school 60 362 -
Source: SEMIS-Census 2001, Census of Private Educational Institutions 1999-2000  


Interestingly and contrary to the belief of many, private schools in Sindh have a higher student-teacher ratio than their counterparts in the public sector. The student-teacher ratio is 58 students for every teacher for private schools and 24 students for every teacher for government schools. This statistic becomes even more interesting if one looks at the average enrolment in a government school, which is estimated to be around 60 students.

This means that, on average, every government school in Sindh has not even three teachers to take care of teaching of teaching for classes I to IV. This could be one reason for the high dropout rate in government schools.

This comparison will not be complete without comparing the quality of education being imparted by them. Another table (number 4) shows the performance of students in Class IV in terms of marks obtained versus type of school. Subjects included in the survey were mathematics, Urdu and general knowledge.

Table 4
Percentage distribution of Class IV children in terms of marks attained & type of school
Type of school Less than 40 % More than 60 % More than 80 %
Public 11.7 31.0 25.1
NGO 11.6 24.2 31.4
Private 1.7 37.7 46.4
Source: EFA-the Year 2000-Assessment Ministry of Education, Government of Pakistan  


As is evident, 46 per cent of students from private schools obtained more than 80 per cent marks, while the corresponding figure for students in government schools is 25.1 per cent. Similarly, over 11 per cent of students in government schools received fewer than 40 per cent marks while in the case of private schools this proportion was only 1.7 per cent.

With less than satisfactory enrolment rates and high dropout rates, the goals of universal primary education and EFA require resources and capacity levels that are simply not available with the government.

There are several reasons why the public sector will be less efficient than the private sector. The problem lies both at the individual and organizational levels. Since government organizations are not driven by the profit motive they have little incentive to maximize productivity, which would show up in an increase in enrolment rates and an enhancement of the quality of education. Another problem lies with the strict rules that govern government recruitment which do not allow for performance-based incentives. Hence, those who could do a lot in this sector by working for the government opt to work in the private sector.

One policy solution lies in the government, instead of working to actually establish and run schools, creating an enabling environment for the private sector to grow and provide education.

The Sindh government has been subsidizing education by providing necessary infrastructure plus extensive incentives programs to students and parents. Parents and students receive incentives in the shape of free textbooks, access to the school management committee fund and scholarships. But there is no choice, as in parents are empowered to choose - accept or reject - the schools of their choice.

At present, the government subsidy for a child of primary school-going age comes to Rs 4,000 per annum. Even after paying this heavy subsidy the results are far from encouraging. It would make them more socially active and involved in their child's education.

Sindh's total education budget for 2002-03 was Rs 18.876 billion. Of this, Rs.9.438 billion were allocated for primary education. This amount alone can finance the annual education of 7.865 million students which would be enough to cater to the province's need given that the number of children in the age group of 4-9 years is 6.226 million.

People tend to think that simply by increasing the education budget both quality and quantity (measured in this case by the enrolment rate) will increase. The above facts and figures go to show that it isn't all as plain as that and that the capacity of the government to effectively and efficiently utilize the funds set aside for education needs to be improved. Increasing the participation of the private sector is one important step towards that.

 

 


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