Free Market for Education

bangladeshschoolgirl.jpgThe common myth regarding the development of primary education, which is suitably considered as the stepping-stone to secondary and higher education, is that it needs crores of donor allocation from the national budget in order for its condition to improve. A layman moralist would preach, “The Government should spend more on education”, without realizing that the whopping sum already spent on it goes waste. It is undisputable that the money allocated for it has to cross layers and layers of Indian bureaucracy and by the time it reaches the level it is targeted for, there is hardly any of it left.

Maybe these hard facts will give a clearer picture of the grim situation. The government spends Rs. 1000-1700 per month per child in a government school, where the drops out rates are as high as 60%. Two out of four teachers employed are permanently absent and the ones that come are involved in gossiping, sleeping, reading comics etc. Teaching activity has been reduced to minimum; 53% of schools remain inactive. More often than not, these government schools are termed as “free”, in contrast to the real situation where the parents end up paying for the tuition fee, examination fee and others.

An education revolution is taking place, in poor urban, semi urban and rural areas a vast majority of school children are now going to “budget private schools”. These are semi-legal set ups which generally do not have recognition and affiliation, but have attracted 70-80% of the total school kids in their area. They are called budget schools as the fee that is charged here is as low as Rs 50-150 per month.

The key concern raised here would be the quality of education in these schools. As compared to the government school education, these concerns are misplaced as researches findings (Dr James Tooley) suggest that in every quality aspect- the private schools seemed to have fared better than the government counterparts. The absence of the teachers was lower, when basic amenities like clean drinking water, clean toilet, library, fans etc were provided. Clearly the private schools are outperforming the government ones. Since these schools run as businesses, the teachers and the administrative staff is accountable for their responsibilities.

I am of the view that a free entry and exit of private players in the field of primary education will provide for an improvement of the sector. As more and more schools open up, the competition amongst them will ensure that the best quality educational institute caters to the need of the people at the most competitive price. To develop a market like that, the government investment can be channelized in more effective manner in the form of micro finance to these schools.

Possibility of a large-scale micro finance project to provide loans to private school proprietor is an area yet to be explored. To make sure that the resources are efficiently utilized, technical assistance should supplement the investment, to provide financial advice. The projects then undertaken by the school can range from improving building, construction of new ones, to buying land etc. Apart from this, small Research and Development projects can be funded by these loans and Donor funds (if necessary) that helps them to incorporate innovative methods of teaching. For education entrepreneurs who wish to set up a chain of such institutes micro finance can be of a great help.

Hence these private schools serving the poor, which are currently operating as business houses, when backed by micro finance style loan scheme can not only improve infrastructure but also the education quality, with giving better results, than the government spending humongous sum on the development of education facilities. The private schools (with the support of micro investment) can definitely prove to be more cost effective and internally efficient than the government schools.