TRENDS IN EDUCATIONAL FINANCES IN .TRENDS IN EDUCATIONAL FINANCES IN KERALA ... little is left for

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  • CHAPTER IV

    TRENDS IN EDUCATIONAL FINANCES IN KERALA

    The preceding chapter presented an analysis of the trends in

    the pattern of funding higher education in both global and Indian

    contexts In this chapter, we propose to trace the changes in

    funding pattern of higher education in Kerala, the reasons for these

    changes and their implications. The purpose of this discussion is to

    place in context the newly introduced 'self financing' mode of

    financing professional education on a large scale. As in the

    previous chapter, we are relying largely on secondary data and

    studies made by earlier researchers.

    4.1 Kerala's Unique Position

    The uniqueness of Kerala's development experience lies in

    the exceptional social development and quality of life in spite of

    low economic development. This is often referred to as the Kerala

    Model of the development which has become the topic of global

    discussion about development.

  • Kerala 's achievements in education include near total

    li teracy, free and universal primary education, low dropout rates at

    the school level, easy accesses and gender equality. In these

    respects Kerala is compared with some of the developed countries.

    It is often acclaimed a s the 'Kerala Model' and some recommend

    Keralization o f the whole education system i n India (Lewis, 1997) ' .

    The nineteenth century initiatives by missionaries and

    princely regimes o f Travancore and Cochin laid the foundation for

    education in Kerala. The social reform movements that took place

    accelerated the spread o f education. Large scale state funding of

    education was an important factor behind state 's educational

    development

    But the state government today finds it very difficult t o

    maintain the gains it has already made. The very success o f Kkrala

    Model o f development in education has generated second generation

    problems, the depth of which have not been fully studied. While the

    demand for funds has been increasing, corresponding government 's

    investment in social sectors like education and health has not been

    increasing, partly because of fiscal cr is is .

    Kera la ' s achievements in the field of education are well

    known and very often a bright picture is drawn. The achievements

  • are definitely laudable. But at the same time, these achievements

    should not allowed t o conceal some of the more serious deficiencies

    and inefficiencies, The state lags behind in technical education and

    research, It may be noted that Kerala's achievements in the

    educational sector had been mostly in the less capital intensive

    areas like school education and general higher education.

    The educational system in Kerala developed in response t o

    the demand created by social, political and religious groups.

    General education dominated over technical education and therefore

    the system got delinked with the production base of the state. The

    higher education is not adapted to the needs o f Kerala's economy.

    Restructuring, diversification and modernisation did not take place

    due t o many reasons including f inancial . In the absence o f fresh

    inputs, the academic programmes are getting obsolete and are

    becoming incapable o f catering t o the requirements of the economy

    in the modern context of knowledge intensive production and

    services

    Large quantum o f funds are required in Kerala for

    diversification o f courses, improvement o f quality and enhancement

    in the intake capacity o f technical education. While the demand for

    more investment is on the increase, the allocation o f funds is on

  • the decrease partly due t o the fiscal cr is is o f the state government.

    The government had been reducing the share o f social sectors in its

    budgets Funds from central government and other funding agencies

    including external agencies t o this sector are o n the decline. Cost

    recovery performance is very poor. All these call for finding

    alternative sources of f inance and implementation o f strict financial

    discipline

    Kerala lags behind in the field o f higher education not only in

    qualitative terms but also in quantitative terms. The demand for

    enrolment i n higher education is higher in Kerala due t o high

    unemployment and the resultant low opportunity cost of higher

    education it may be noted that the successive rounds o f National

    Sample Survey have confirmed the highest incidence of

    unemployment in Kerala among states. But there exists a wrong

    impression that higher education in Kerala has expanded well .

    Even the Ashok Mitra Commission (1999)' has observed "The

    higher education system in Kerala has extensive reach". The

    Commission has observed that 10 per cent o f those who enter school

    enrol1 for University education and the total percentage students

    entering higher education accounts for 1 5 per cent of the relevant

    age group But the Commission's impression is not based o n facts.

  • The gross enrolment ratio in higher education in Kerala is

    only 3 7 per cent of the relevant age group (18-24) population It t s

    to be noted that the all India gross enrolment rat io in higher

    educatton ts around 6 per cent In other words, the enrolment rattc

    in Kerala is lower than the national average. It is important to note

    that this ratio has come down in Kerala from 1972-73 when it was

    5 . 9 percent (Tilak 2 0 0 0 ) ~ . Several other indicators also point t o the

    fact that Kerala lags behind in higher education. The percentage o f

    population with higher education was 3.9 percent in the state during

    1995-1996 The national average for the same was 4 .2 percent. At

    least, 15 states are ahead o f Kerala. O n this count Kerala is no

    better than Uttar Pradesh ( Tilak 2 0 0 0 ) ~ .

    Enrollment in Arts, Science and Commerce colleges in Kerala

    is given in 'Table 4 1

    Table 4.1 : ENROLMENT IN ARTS & SCIENCE COURSES IN

    UNIVERSITIES OF KERALA University

    Kerala M. G. Universi ty Calicut Kannur ~ Total

    Source Based on Economic Review 2000

    Enrolment Degree . Post graduate

    ----l Total

    49145 39194 43658 12888

    144885

    5271 4577 3663 1074

    14585

    54416 43771 47321 - 13962 159470

  • The total number o f degree and post graduate students in the

    affiliating Universities comes t o 159470. Of the total under

    graduate students number 1.45 lakhs and post graduates number

    only 0 .15 lakhs.

    The technical educational institutions especially engineering

    institutions were few till recently. Their number remained almost

    stagnant during the period 1970-71 to 1995-96. It was after 1993

    that the number of engineering colleges started moving up and it

    was due to the introduction of self financing institutions by

    Universities, IHRDE, LBSCST, KSRTC etc. Given below is a table

    showing enrollment in engineering colleges in Kerala

    Table 4 .2 :

    . 5798 8543

    Source Based on Economic Review, 2000

    ENROLMENT IN ENGINEERING COLLEGES IN KERALA

    4.2 Fiscal crisis of Kerala and the declining public expenditure on education

    Year

    1997 1998

    The fiscal crisis of Kerala is setting a limit to the States's

    ability to finance public expenditure as in the past. This is evident

    No, of Engineering Colleges

    15 1 5

    Annual Intake

    4844 4844

  • from Table 4 3 The table shows the gravity of the fiscal crisis in

    the state compared to all states

    Table 4 . 3 MAJOR FISCAL INDICATORS FOR KERALA

    Table 4 4 gives the share of education in the budgetary

    Figures in percentage

    expenditure of Kerala and All States,

    Year 1990-95 1996-97 1997-98 1998-99RE 1999-2000BE

    Table 4 . 4 SHARE OF EDUCATION, ART, CULTURE & SCIENTIFIC

    3 . T o t a l Expenditure 1 2 7 . 4 1 2 4 . 1 1 2 2 . 2 1 22 .3 1 2 1 . 9 1 1 5 . 5 1 15 .0 1 5 16 .6 1 16 .3 a. Plan -. 1 10.6 1 8 2 d 6 . 9 1 5 . 4 1 6 . 2 1 5 .4 1 4 . 5 1 5 . 8 1 5 . 7 1 8 . 4 b. Non P l a n 1 3 2 . 5 1 3 0 . 7 1 2 7 . 0 ( 2 6 . 9 1 2 7 . 0 1 2 0 . 2 / 2 0 . 2 1 2 0 . 9 1 2 1 . 2 1 1 9 . 7 Source: Limits to Kerala Model of Developments, K.K.George,

    Source: Finances of State Government 1998-99, R .B . I . Bulletin Feb. 1999

    State Finances, a study of budgets of 1999-2000, R .B . I . Bulletin Jan

    2000 Notes: 1. GFD Gross Fiscal Deficit. 2 GFD Exp. Gross Fiscal Deficit expenditure 3 RE-Revised Estimates 4. B E - Budget Estimates

    .

    CDS, Trivandrum 1999, p.82.

    GFDJGFD EXPENDITURE KERALA

    20.7 20.1 2 5 . 3 2 5 . 4 21 .6

    REVENUE DEFICITIGFD ALL STATES

    19.0 19.6 26 .3 28.5 26 .1

    KERALA 44.0 41 .7 4 6 . 5 57 .6 67 .5

    ALL STATES 24.6 43 .3 37 .0 5 3 . 8 27 .7

  • The table shows that a large share of the revenue expenditure

    is on non plan account and is of a recurring nature. Most of the

    allocation for education is spent on salaries, with the result that

    little is left for current inputs, modernisation and restructuring.

    Besides the share of capital expenditure is relatively low,

    The table also shows that i