ISLAMABAD: Education sector in Pakistan is in crisis and financing remains a critical issue, according to a report submitted to the just-concluded Oslo Summit on Education for Development where Prime Minister Nawaz Sharif was among the speakers.

The country case study titled “Financing Education in Pakistan: Opportunities for Action” said the inclusion of right to education in the Constitution showed an elected government’s commitment to education. The challenge now is how to turn the guarantee into a reality.

Know more: Despite challenges, Pakistani govt giving top priority to education, PM tells summit

According to the study released on Saturday by the Norwegian government which hosted the summit, domestic financing is the largest and most important source of funds for the sector. Pakistan’s commitment to education is reflected in its longstanding target of spending four per cent of the GDP on education.

Allocation has not exceeded 2.5 per cent of GDP, Oslo Summit told

The target was set in 1992 and the pledge has been repeated in government policies and education sector plans since then. This target was reiterated by the current government, with the aim of achieving it by 2018 as stated by Mr Sharif at the summit.

However, spending has so far fallen far short of the target. In recent years, the allocation has not exceeded 2.5 per cent of the GDP, and only reached 2 per cent in 2013-14.

In absolute terms, Pakistan spent $5.3 billion on education in 2013-14. As a proportion of the total government expenditure at both federal and provincial levels, the country spends no more than 10 per cent on education.

Given the current spending patterns, Pakistan faces enormous financing challenges. According to calculations prepared for the 2015 Education For All Global Monitoring Report (EFA GMR), to meet post-2015 education goals by 2030, the country will have to increase its current per student expenditure by 10 times at the pre-primary level, by six times at the primary level, and by four times at the lower secondary level.

The report prepared by Unesco says that Pakistan is among a minority of lower-middle income countries which will need to roughly double spending on basic education to achieve goals by 2030, and will have to increase proportion of GDP allocations to basic education by almost three times.

The small size of allocations for education sector in Pakistan is largely related to the government’s capacity to raise tax revenue. The government’s capacity to raise revenue through taxation is extremely limited as the federal government has not been able to raise the tax-to-GDP ratio for several years.

The case study points out that tax reforms remain a huge public policy hurdle, with little will within parliament to implement measures required to improve tax revenues. While the Federal Board of Revenue’s tax collection has increased in absolute terms, it has remained at just 8.7 per cent of the GDP for the past 10 years — among the lowest proportions in the world.

Despite the signal of strong commitment, a significant proportion of funds allocated for education sector remains unspent. Budget tracking exercises over the past couple of years reveal patterns of under-spending for both recurrent and development expenditure in all provinces.

Between 2010-11 and 2013-14, nine per cent to 13 per cent of Punjab’s education budget remained unspent.
Data for Sindh also reveals erratic patterns in spending of education funds; nearly a quarter of the education budget remained unspent in 2013-14, equivalent to $310 million. This amount could support 2.7 million primary children in schools.

Spending in the smaller provinces — Khyber Pakhtunkhwa and Balochistan — appears to be better, with the former spending more than its budgetary allocations in some years.

The country also receives bilateral and multilateral aid for education sector and these funds are important for supporting the education system. Aid to education has dramatically increased from $20m in 2002 to $432m in 2012.

Pakistan is among the top 10 countries receiving aid for education. One potential reason for the relatively large amount of aid it receives may be that donor countries are keen to continue engagement for geopolitical and security reasons, the study says.

Aid to basic education has been the main focus of the official development assistance to Pakistan, accounting for more than 50 per cent of the total aid to education since 2002. The proportion of aid to higher education exceeds spending on secondary education and its share has been increasing.

A reason for changing priorities within education is related to a shift in priorities by donors over the years, the study says.

Donor coordination has always been difficult in Pakistan. With about 30 donors working in the education sector, it has been a tough task to coordinate their activities and funding. One reason for lack of effective and sustained coordination has been lack of a strong position by the federal government to spearhead initiatives.

Published in Dawn, July 12th, 2015

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