Mukherjee, Anit K.

Sen, Tapas K.

English

Research Papers in Economics

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POLICY BRIEF POLICY BRIEF POLICY BRIEF POLICY BRIEF POLICY BRIEF              November 2007
I. Introduction
India’s flagship program for universalisation of elementary 
education – the Sarva Shiksha Abhiyan (SSA) is regarded 
as one of the largest such initiative anywhere in the 
world. Started in 2001-02, it has recorded impressive 
achievements by any yardstick. According to Ministry 
of Human Resource Development (MHRD) data, nearly 
1,60,000 primary and upper primary schools have been 
opened, more than 6,50,000 additional classrooms have 
been constructed and 500,000 additional teachers have 
been appointed. Independent surveys show that nearly 
92 percent of India’s elementary school-age children are 
currently enrolled.1 However, government’s own surveys 
also show that there are still nearly 13 million children out 
of school – a figure which is still very substantial.2
At the beginning of the 11th Five Year Plan, SSA stands at 
a crossroads. While the last five years have seen frenetic 
activity on expanding and upgrading infrastructure, 
appointment of teachers, setting up of training systems, 
and strengthening decentralisation of education to the 
district, block and panchayat level, the next five years will 
determine whether the investments have been translated 
into higher levels of educational achievement – the most 
important being improvement in the quality of education. 
Lessons need to be learnt at this stage to enable a more 
focused approach to financing and implementing the 
second phase of the SSA.
II. Assessment of SSA Financing 
Given the experience of the last five years, two lessons 
stand out regarding the financing of the program. These 
can be categorised broadly into two parts – (i) financial 
coordination between the Centre and the states; and (ii) 
targeting of SSA programs to educationally backward 
districts.
1
   
UNIVERSALISING ELEMENTARY EDUCATION:
AN ASSESSMENT OF THE ROLE OF THE SARVA SHIKSHA ABHIYAN
The Policy Brief series is aimed at stimulating policy discussion on specific issues by summarising results of 
research carried out in-house at NIPFP and elsewhere on the broad theme of Financing Human Development. 
Dissemination of these is a part of the research programme currently underway at NIPFP on the same theme, 
supported by the Planning Commission and UNDP. 
NATIONAL INSTITUTE OF PUBLIC FINANCE & POLICY NO. 2
FINANCING HUMAN DEVELOPMENT
Anit N. Mukherjee and Tapas K. Sen
1 Pratham. Annual Status of Education Report, 2006
2 MHRD. Out-of-School Survey, 2005(i) Resource allocation among states
The structure of SSA was conceived as a demand-driven 
program that envisaged a partnership  between all the 
decentralised tiers of the government right down to 
the Gram Panchayat level. Requirements for filling the 
infrastructure and teacher gaps at the lowest level (villages 
and blocks) are consolidated into the District Annual Plan, 
which is then consolidated at the state level into the 
Annual Work Plan and Budget (AWP&B). 
The state AWP&B is then presented to a Project Approval 
Board (PAB) at the central ministerial level. A perusal of 
the minutes of the meetings of the committee indicates 
that the final figure for the states is more often than not 
an outcome of bargaining between the two sides.3 The 
additional complication is that since SSA is implemented 
by district and state-level societies, there is frequently a 
budgetary spillover, which is then incorporated into the 
AWP&B of the subsequent year.
There is a need to limit the discretion of the PAB at the 
centre to modify the state-level annual plans. If SSA is 
essentially a demand-driven program, then it should be left 
to the states to decide on the final outlay for the program, 
particularly when a sharing arrangement has been built 
into the scheme. There has so far been no operative 
overall resource constraint in SSA to necessitate pruning 
of the state plans. In fact, it is the implementing capacity 
of states, particularly the relatively backward ones and 
the ability to put up the matching allocations by them 
that has proved to be the constraint. The annual ritual of 
drawing up and consolidating work-plans degenerates into 
an exercise where the usual line items such as buildings, 
classrooms and teachers are catered to, while more 
pressing interventions such as innovation and quality are 
left unattended.4 
The problem can be taken care of if two parameters 
are monitored – the extent of budgetary spillover and 
the contribution of the state government. If the state 
government contributes its share of the SSA plan by the 
third quarter, it would indicate that the sub-national 
government is serious about providing adequate resources 
for universalisation. Absence of spillover would indicate 
that adequate implementation capacity at the local level 
exists, and there is no reason for the centre to revise the 
figures drawn up through the AWP&B process at different 
levels of decentralisation. 
(ii) Resource allocation within states
The second issue concerns whether allocations and 
expenditure within a state – as well as within a district and 
block – is in line with the objectives of the SSA. States in 
India are larger than many countries, and consequently 
require more decentralised analysis vis-à-vis specific 
areas of concentration of out-of-school children, lack of 
infrastructure, teachers etc. One of the main objectives 
of SSA was to address inequities in education in terms 
of access and outcomes by aligning financing with the 
needs of particular regions and communities. In that sense, 
preliminary examination of the data points to significant 
underachievement in this objective.
District-level analysis bears this out even for a better-
performing state like Tamil Nadu. The share of SSA going 
to a relatively advanced district like Coimbatore is more 
than double compared to the worst performing district 
– Karur – with eight times higher rate of out-of-school 
population (see figure). The Tamil Nadu case is just an 
example – it has also been observed for other (including 
more backward) states such as Madhya Pradesh, Orissa 
and West Bengal. 
It may be argued that the scale of operations is important, 
which is not fully reflected in the percentage of out-of-
school children. However, multiple regressions using 
2
3 The negotiation for Orissa, for example can be accessed at: http://education.nic.in/ssa/240406or_pab.pdf
4 Dhir Jhingran and Deepa Sankar. Orienting Outlays toward Needs: An evidence-based, equity-focused approach to Sarva Shiksha Abhiyan. 
Mimeo. district level data indicate that scale of operations is indeed 
important; but it appears to be the only important factor. 
Controlling for scale, it has been found that need factors 
do not determine the share of SSA resources in the four 
states studied so far. A similar analysis by Jhingran and 
Sankar (op. cit.) confirms this for inter-state allocation of 
SSA funds as well. 
III. Looking Ahead to SSA – Phase 2
Over the next five years, the major change in the financing 
of SSA will be an increase in the share of contributions by 
the state governments. States’ share of SSA funds will rise 
to 50 percent from the earlier share of 25 percent. Most 
state governments showed unwillingness to increase their 
expenditure on the program, and a few of them failed to 
contribute the requisite 25 percent over the last phase. 
Given the increase in tax collections by sub-national 
jurisdictions, greater spending on education will have 
to be a priority if the SSA objectives have to be fulfilled. 
Financing elementary education in the long run remains 
the prerogative of the sub-national government, and those 
that do not do so will lose out in terms of achieving their 
development goals.
 
There are already instances of a rollback in some states, 
possibly as a response to the rise in the state share in 
total SSA expenditure. In Orissa for example, a drive is 
under way to close down primary schools that do not 
have adequate number of students and which have 
other schools within a specified distance. This may be 
prompted by efficiency considerations and therefore 
justifiable. However, the fact remains that it is a reversal 
of the unidirectional policy of expansion prompted by the 
earlier phase of SSA when the bulk of the funding came 
from the Government of India. 
Research conducted at NIPFP has shown that most states 
will close the infrastructure and human resource gap 
in elementary education by the middle of the Eleventh 
3
Top 5 and Bottom 5 districts - Tamil Nadu
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% Out-of-school
SSA Share
Figure: Mismatch between Objectives and Allocations under SSA4
Five Year Plan. The educationally backward states will 
continue to receive grants mandated by the 12th Finance 
Commission specifically for supplementing state resources 
for SSA. In such a case, there is considerable flexibility 
available to reorient SSA towards a more focused approach 
in improving teaching standards, reducing drop-out rates, 
and increasing the learning achievement of students at 
the elementary level. To achieve this, the system of fund 
allocation among states at the first instance, and then 
within states, will have to be guided by something more 
than just what is demanded. In any case, the system is 
not fully demand driven as it is, since AWP&Bs are not 
accepted as they are. 
Moreover, there is reason to believe that the annual 
work plans put up by the educationally more backward 
areas tend to be less ambitious than the others; available 
expertise in drawing up such plans in a fully articulated and 
consistent manner may explain this phenomenon since 
such availability is in direct proportion to the educational 
achievements in an area. But that cannot be a reason for 
depriving needy areas from the deserved allocations. This 
policy shortcoming argues for formally allocating at least 
a part of the available funds – at the central, the state and 
the sub-state levels – on the basis of objective indicators 
of educational achievement. The MHRD tries to do this 
by identifying focus districts, and reserving a part of the 
total allocation under each category of expenditure for 
the focus districts. This is actually an inferior method of 
targeting, since (a) the identification is based on indirect 
proxies of educational indicators (essentially social 
composition of the population of the district), which is 
unnecessary since more direct indicators are available and 
(b) it still leaves open the issue of allocation within the 
subset of focus districts. Direct application of educational 
indicators should improve targeting, eliminate the second 
problem and leave less scope for discretion.

Universalising elementary education: An assessment of the role of the sarva shiksha abhiyan.

http://www.nipfp.org.in/tapasreport/PDF/policybrief2.pdf

Universalising elementary education: An assessment of the role of the sarva shiksha abhiyan.

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