Budget 2018: With just 4% hike in education allocation, Modi govt is hoping to earn dividend without investment

Recently, I was addressing an investors meet of largely middle aged people in Chennai. And in that conversation, I asked:

Question. If you were to have Rs 10 lakh with you and have to choose between spending it on the following, what would you do?
A) Buying your first dream Home
B) Expanding your home
C) Paying the entire money for your child’s education

An overwhelming majority of them, mostly parents, chose option C. Most parents prioritise education of children over any other capital investment. However, the same parents, when in positions of authority and deciding for the country do exactly the opposite. I have always wondered what changes their behaviour? And one of the parents had the right answer. He said ‘We decide for our children and governments never consider citizens as their own children’!

Representational image. Reuters.

Representational image. Reuters.

That for me is a stunning condemnation of all governments of all time. And the current Budget presented by Finance Minister Arun Jaitley only accentuates this anomaly. Consider the facts:

• The total revenue receipts increased from Rs 15.05 lakh crore (2017-18) to Rs.17.25 lakh crore (2018-19), an increase of 14.63 percent.

• The allocations for education increased from Rs 81,869 crore (revised estimates) to Rs 85,010 crore, an increase of Rs 3,141 crore or a paltry 3.84 percent only.

• If you were to remove the 1 percent increase in cess that we will be paying, (approximately Rs 2,750 crore), the increase in Budget is just about Rs 391 crore. That is an increase of a measly 0.46 percent. Yes. You read that right.

• And the tragedy doesn’t end there. By a sleight of hand, the education cess, which is estimated to be are Rs 11,000 crore has been renamed as ‘health and education cess’. Which means they would possibly start using the education cess for health purposes. This also means that the education Budget for the current year has been reduced as compared to last years revised estimates.

For a country which is sitting on a powder keg of youth below age 25, and a prime minister who talks ‘India is blessed with democracy, demand and demographic dividend’ on foreign shores, this Budget belies all expectations. A government which acknowledged that India must spend at least 6 percent of GDP on education, this is an appalling contradiction. Because, for the first time, the allocation on education has come down from 3.69 percent of GDP (2017-18 revised estimates) to 3.48 percent (2018-19 Budget estimates) of GDP. It looks as if we are walking in the reverse direction while talking of moving forward..

There are measures in the Budget that are good but many of them must be in an Ministry of Human Resources and Development (MHRD) policy document than in a Budget speech. Integrated B.Ed programs, moving from black board to digital are not necessarily Budget items. The so called proposed investment of Rs 1,00,000 crore ‘Revitalising Infrastructure and Systems in Education (RISE)’ is a promise with no allocation made in the Budgets. Not surprisingly, much of such plans stretch up to the year 2,022 with no allocations made in the current year. One scheme that stands out is the Eklavya schools for ST students. But how do we service all these initiatives with zero or negative funding.

It looks as if the government expects dividends with no investments being made. How do you explain the repeated claim of ‘reaping demographic dividend’?’ As politicians, they may reap dividends without investments but the citizens of the country have only paid taxes on dividends that were never received. This Budget on education is symbolic of the shambles that education has been led to..and the long road downwards may have just begun..

(The writer is founder and chairman of Careers360. He tweets @maheshperi)

Click here for full coverage of Union Budget 2018.

 


Updated Date: Feb 02, 2018 20:40 PM

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