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Declining Education Budget of Pakistan By Kashif Mirza


Jun 16, 2024

The writer is an

economist, anchor,

analyst and the

President of All

 Pakistan Private

Schools’ Federation



Budgetary allocations show education is not a priority of the ruling class. The Pakistan’s public education spending as a percentage of the gross domestic product is gradually declining. The cumulative education expenditures by federal and provincial governments declined as percentage to GDP in fiscal year 2023 at 1.5 percent of GDP compared to 1.7 percent of GDP in the previous year, which is lowest in the region. Prime Minister Muhammad Shahbaz Sharif’s declaration of a national education emergency rings hollow as the federal government allocates a paltry 93 billion rupees only for education. (merely 0.5% of the total budget) for the education sector in the 2024-2025 budget. This move contradicts the PM’s promise to prioritize education. The education budget has been consistently declining since 2017, with a staggering 1.5% decrease in GDP expenditure on education in the current fiscal year (2023-24). The literacy rate is projected to plummet to 62.8% from 63.8 %, exacerbating the crisis. For each successive government, education has apparently been a top priority in theory only, and within the  realm of education, getting out-of-school children in Pakistan back to schools and increasing and easing access to higher levels of education have proven to be major challenges. While all political leaders at the helm of country’s affairs claim to have a special place in their hearts for education. Governments in Pakistan are known to make only hollow promises regarding the importance of education, but what is truly more worrying is the fact that whatever little allocations they manage to make, those in power have consistently appeared incapable of utilizing those allocations to the full. After the 18th Amendment, provinces get their own finances for education. Punjab and Sindh both allocated just less than 2% of their education budget for technical and vocational education, whereas Khyber Pakhtunkhwa and Balochistan allocated only 1% percent share of its education budget for the same. Provinces allocated less than two percent for other sub-sectors, such as teacher education, special education and literacy and non-formal education. Unfortunately, all the provinces couldn’t spend the allotted budget they earmarked for education sector for the last many years. The proposed 10% sales tax on educational goods in the budget FY24-25 will further burden low-income families, making it unaffordable for them to educate their children. The All Pakistan Private Schools Federation has urged the government to increase the education budget by at least 5% in 2024-25 to address the pressing needs of 26 million out-of-school children and the recruitment of 2.5 million teachers. The government’s spending on education is abysmally low, with less than $50 per year on school education and less than $150 per student on higher education. The UNICEF reports that 16 million children have been affected by the devastating floods, destroying over 39,000 schools and threatening to leave 3 million students out of school permanently. Moreover, 40 million children have been impacted by school closures during the pandemic, with many falling victim to child labor. The Economic Survey 2023-24 noted that expenditures on education-related activities during fiscal year 2023 increased 13.6 percent and reached Rs. 1,251.06 billion from Rs. 1,101.7 billion. During 2021-22, the PSLM Survey was not conducted by Pakistan Bureau of Statistics (PBS) due to the scheduled Population and Housing Census 2022. Therefore, the figures for the latest survey regarding GER and NER may be considered for the analysis. However, according to the Labor Force Survey 2020-21, the literacy rate was 62.8 percent in 2020-21 as compared to 62.4 percent in 2018-19, higher in males (increased from 73.0 percent in 2018-19 to 73.4 percent in 2020-21) than females (from 51.5 percent to 51.9 percent for the same period). Area-wise analysis suggests literacy increased in both rural areas from 53.7 percent in 2018-19 to 54.0 percent in 2020-21, while in urban areas, it increased from 76.1 percent in 2018-19 to 77.3 percent in 2020- 21. The male-female disparity seems to be narrowing down over time. The literacy rate has gone up in all provinces, with Punjab (increased 66.1 percent to 66.3 percent), Sindh (61.6 percent to 61.8 percent), Khyber Pakhtunkhwa (52.4 percent to 55.1 percent), and Balochistan (53.9 percent to 54.5 percent). The literacy rate (10 years and older) is 60 percent, showing that males are more literate than females. Punjab is at the top, while Balochistan is at the bottom. Youth literacy (15- 24 years) is 72 percent (Male: 79 percent and Female: 65 percent). The province-wise comparative situation is the same, with higher disparities for females than males in youth literacy rates. The adult literacy rate is 57 percent (Male: 68 percent and Female: 46 percent), which indicates that the adult male population is more literate than the adult female population. In the Pakistan Social and Living Standards Measurement (PSLM) 2019-20, the Out-of-School Children (OOSC) rate was 32 percent in the country, with a higher rate of female OOSC (37 percent) than males (27 percent). Punjab had a 24 percent OOSC rate, Sindh 44 percent, Khyber Pakhtunkhwa 32 percent, and Balochistan 47 percent. In all provinces, more females were out of school than males.

The Economic Survey of Pakistan 2023-24 has pointed out that only 1.5 per cent of GDP was spent on the education sector last year while the literacy rate was recorded at 62pc. Cumulative education expenditures by federal and provincial governments in FY2023 remained at 1.5pc of GDP. Education-related expenditures during FY23 witnessed an increase of 9.7pc, reaching Rs988 billion from Rs901bn. The cumulative education expenditure by the federal and provincial governments in the financial year 2021-22 totalled 1.7 per cent of GDP against 1.9 per cent in 2019-20, 1.98 per cent in 2018-19 and 2.12 per cent in 2017-18. The spending, however, went up from Rs901.013 billion in 2019-20 to Rs988.032 in 2020-21. It was Rs868.022 billion in 2018-19 and Rs829.152 billion in 2017-18. Rs. 65 billion have been allocated for the non-development expenditure of the HEC. Rs. 44 billion have been allocated for the development schemes of the HEC as well. Overall, the budget for the education sector has received a cut by 1.5 percent from Rs. 91.970 billion for the current fiscal year to Rs. 90.556 billion for Education Affairs and Services in the federal budget for 2022-23. We can see that Pakistan education spending for 2017 was 14.54% which was 0.52% decline from 2016; spending for 2016 was 15.06%, a 1.88% increase from 2015; spending for 2015 was 13.19%, a 1.89% increase from 2014 and spending for 2014 was 11.30%, a 0.21% decline from 2013. The actual percentage share for education out of the entire budget has declined in all but one province, and there too, the education budget saw no real term increase. In Punjab, the percentage share of education in overall budget decreased from 24% in 2014-15 to 19% in 2018-19, whereas it went down from 21% to 18% in Sindh. In Balochistan, it decreased from 21% to 18%. However, the net allocation remained the same in Khyber Pakhtunkhwa at 26%.

Budgetary allocations show education is not a priority of the ruling class. Governments in Pakistan are known to make only hollow promises regarding the importance of education, but what is truly more worrying is the fact that whatever little allocations they manage to make, those in power have consistently appeared incapable of utilizing those allocations to the full.

All provinces couldn’t spend the money they earmarked for education sector during 2017-18. Sindh had the highest rate of under-utilization at only 29%. The country’s literacy rate, which was 62 per cent in 2022-23 compared to 62.4 per cent in 2018-19. The percentage went up from 73 to 73.4 in men and from 51.5 to 51.9 in women. The narrowing down of the men-women disparity was also reported. The area-wise analysis showed the literacy ratio increased from 53.7 per cent to 54 per cent in villages and from 76.1 per cent to 77.3 per cent in cities. All provinces recorded higher literacy rate. It went up from 66.1 per cent to 66.3 per cent in Punjab, from 61.6 per cent to 61.8 per cent in Sindh, from 52.4 per cent to 55.1 per cent in Khyber Pakhtunkhwa and from 53.9 per cent to 54.5 per cent in Balochistan. The enrolments recorded during 2019-20 were 55.7 million compared to 53.1 million in 2018-19 showing an increase of 4.9 per cent. It’s estimated to surge to 58.5 million next year. The nationwide educational institutions totalled 277.5 thousand in 2019-20 compared to 271.8 thousand in 2018-19 with the likelihood of the tally reaching 283.7 thousand in one year. Similarly, the number of teachers came to 1.83 million in 2019-20 compared to 1.79 million last year with a likely jump to 1.89 million within a year. There was a budget cut for the higher education regulator, HEC, in the year 2021-22. The federal government initially allocated Rs42.45 billion for the HEC to implement 168 development projects of public sector universities and higher education institutions but later rationalised and curtailed the funding to Rs32.338 billion. Despite HEC’s demand in an increase of the education budget, the government has decided to cut costs. Pakistan’s public education spending as a proportion of GDP is expected to be 1.7 percent in fiscal year 2021-22, down from 1.9 percent the previous fiscal year, the lowest in the region. Following the 18th Amendment, the Federal Government has primarily been funding higher learning, with education being divided between different regions. The federal government has slashed the Higher Education Commission’s (HEC) recurrent budget for the fiscal year 2024-25, and only 25.7 billion is allocated for education. Interestingly, that amount is almost equal to Rs24 billion of Cambridge Board fee which they earned from Pakistani students for O-Levels Exam Fee only, whereas, Pakistan total federal education budget is Rs97 Billion.

Pakistan’s allocation for education is nothing to write home about really. But worryingly, the center and the provinces seem incapable of fully spending what little they decide to spend for uplifting a sector most important for national progress. The government is also very much focusing on improving both the quality and coverage of education through effective policy interventions and enhancing allocation of resources, but the required reforms and improvements in the education sector cannot be achieved without the allocation of minimum 5 percent of the GDP for education in the budget with full utilisation of the budget and active participation of the private sector. To address these challenges, a dedicated budget for eliminating child labor, establishing a special education fund, and promoting smart classrooms, faculty development, and science vehicles is crucial. At least 25% of schools and colleges must be converted into high-tech technical institutions to ensure a skilled workforce. The government must prioritize education and withdraw the proposed 20% tax on welfare educational institutions to avoid hindering the provision of quality education. There was a need to involve all stakeholders for the timely release of funds as well as capacity building of education managers, institutions, organizations and departments. The regular, smooth, and fair utilization of budget requires interaction and coordination between various departments of regions and provinces. It is important to figure out what are the causes of poor utilization of budget. The present and previous data indicate that there is a dire need to develop a robust financial management system for education sector. Adequate budgetary allocation by dedicating a significant proportion of the country’s Gross Domestic Product (GDP) to education is essential. This cash injection will revitalise the system, effectively resolving crucial shortcomings. There’s also need of quality professional development for teachers. It is crucial to establish top-notch institutions that focus on the professional growth of teachers, covering all levels, from basic to higher education. Teacher education facilities must be adequately funded and staffed with competent personnel to conduct regular training programmes. By strengthening accountability and improving the system of accountability is of utmost importance. Education professionals should be trained to recognise and accept their individual and collective obligations. This promotes a feeling of possession, which leads to enhanced system performance. Dynamic Curriculum Evaluation thorough yearly assessment of the curriculum is essential. Minimising political intervention is equally essential for the efficient and impartial operation of the education system. The expeditious and effective implementation of policies requires a strong political determination from the administration. Reforming the examination system by eliminating the impact of unfair practices, corruption, and unlawful bribes from the examination system. Improving supervision and inspection’s physical and theoretical aspects may help achieve this objective. Government assistance, such as augmented remuneration for educational practitioners, is essential to deter unethical behaviours. Fostering a research culture is crucial to foster a culture of research inside educational institutions. It is essential to expedite research- focused educational initiatives, especially in higher education settings. The government should increase the funds of the Higher Education Commission to support this effort. There’s a need to argues that education catalyses change, promoting growth in several facets of life, such as social, moral, spiritual, political, and economic domains. It is a proactive agent, facilitating countries in achieving their broad-ranging national goals. Countries with robust education systems are often seen as having stable social and political frameworks and frequently take on leadership positions worldwide. Regrettably, the present education system in Pakistan has failed to effectively carry out its crucial function in the development of the country, leading to widespread discontent among the Pakistani population, and characterised by its ineffectiveness, has left the next generation without clear guidance, as it has failed to develop a strong basis in economic, social, political, and moral domains.

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