1. Overview of Education Budgeting And Resource Allocation Process In Sri Lanka Nisha Arunatilake Roshani de Silva Institute of Policy Studies

2. Presentation outline Introduction to education finance in Sri Lanka Education administration structure in Sri Lanka The budgetary process Budget implementation and monitoring Non-public sources of funding

3. Presentation outline Introduction to education finance in Sri Lanka Education Administration Structure in Sri Lanka The budgetary process Budget Implementation and monitoring Non-public sources of funding

4. Education Finance in Sri Lanka Since 1949 –main source of funding has been government 1992 govt. at different levels spent Rs. 36.54 billion on Education (== 2.3% of GDP; 9.1% of Govt. Expenditure) Since 1990s government expenditure on education has declined over the years Compared to other developing countries – govt. expenditure on education is low

5. Types of Expenditure Public expenditure finances inputs to the supply and development of education: Physical investment inputs – buildings,furniture Human resource investments – teacher training, curriculum development Recurrent inputs – teacher salaries

6. Total Expenditure Budget Social Development and Welfare HealthHousing Social SecurityWelfare Service Community Based Programme Physical Planning Education Education Publication Department Total Expenditure Budget Social Development and Welfare HealthHousing Social SecurityWelfare Service Community Based Programme Physical Planning Education Total Expenditure Budget Social Development and Welfare HealthHousing Social SecurityWelfare Service Community Based Programme Physical Planning Education Total Expenditure Budget Social Development and Welfare HealthHousing Social SecurityWelfare Service Community Based Programme Physical Planning Education Universities Examination Department General Public Service Public Order and Safety General Administration Defence Provincial Councils (8 Councils) Ministry of Skills Development, Vocational and Technical Education Ministry of Education Technical Colleges Education Publication Department Total Expenditure Budget Social Development and Welfare HealthHousing Social SecurityWelfare Service Community Based Programme Physical Planning Education SOURCE: Budgatery Procedures for Education in Sri Lanka, mimeo

7. Presentation outline Introduction to education finance in Sri Lanka Education Administration Structure in Sri Lanka The budgetary process Budget Implementation and monitoring Non-public sources of funding

8. Education administrative structure in Sri Lanka Since 1987 education became a devolved subject The present administrative structure with more powers to the provinces is a result of this change At present there are five administrative tiers (as oppose to the earlier three): Ministry of Education, Prov.l Ministry/ Prov. Dpt. Of Edu., Zonal education offices. Divisional education Offices, Schools

9. Source: Present Education System and Management Structure http://www.moe.gov.lk

10. Education administrative structure - contd Ministry of Education Policy formulation, implementation and coordination; management of national and other special schools; regulation of private schools; development of of school curriculum; teacher training Provincial Ministry/ Dpt. Of Education Administration of provincial level education Funded by provincial council through its ministry of education

11. Education administrative structure - contd Zonal Education Offices Administration of schools at the zone level, quality improvements in teaching and learning at this level Divisional Education Offices Supervision of schools, distribution of welfare items, data collection Schools 2002: 9,829 government schools; Of these 9,509 provincial schools; 320 national schools Private schools reg. Before 1960 – 66; assisted private schools – 33; English medium international schools -?

12. Presentation outline Introduction to education finance in Sri Lanka Education Administration Structure in Sri Lanka The budgetary process Budget Implementation and monitoring Non-public sources of funding

13. Education Budgetary Process Overall Budget Program-wise: General administration; Primary education; Secondary education; Education development; Special education Recurrent Category wise: personal emoluments, traveling expenses, supplies, maintenance expenditure and contractual services, transfers, grants, subsidies, etc Capital Category wise: rehabilitation and improvement of capital assets, acquisition of fixed assets, capital transfers, other capital expenditure, operation cost of donor funded projects

14. Source: NEC, 2003, p. 249. Note: The above diagram has been modified (as indicated by broken arrows) MINISTRY OF FINANCE AND PLANNING BUDGET DIVISION (RECURRENT EXPENDITURE) DEPARTMENT OF NATIONAL PLANNING (CAPITAL EXPENDITURE ) FINANCE COMMISSION PROVINCIAL EDUCATION AUTHORITIES TYPES 1AB AND 1C SCHOOLS (OTHER THAN NATIONAL SCHOOLS) TYPE 2 AND TYPE 3 SCHOOLS MINISTRY OF EDUCATION NATIONAL SCHOOLS Recurrent Expenditure for National Schools Capital Expenditure and Funding from donor-funded projects Capital funds from Finance Commission for province specific development priorities Capital budget allocated by Treasury Funds from foreign funded projects & local special Education projects as capital funds

15. Determination of Education Budget for Provincial Schools

16. Zonal and Divisional Offices Provincial Department of Education Planning Branch Provincial Council Finance Commission Treasury Finance Commission Members Cabinet National Budget *Divisional Offices assess the needs of the schools and provide information to the zonal offices. *Zonal offices discuss with divisional offices and schools, prioritize and submit to Provincial Department of Education *The Provincial Department of Education reviews and consolidates the budget proposal made by the zone and prepares the provincial education budget proposal *Chief Secretary, Provincial Council submits budget to the Finance Commission *The estimates are reviewed *Discussions with Provincial Education authorities * Discussions with Treasury officials and Treasury arrives at a ceiling * Commission members approve budget and signing of financial report *Report is submitted to the President *President submits to the Cabinet *After Cabinet members approve the budget, it is sent through the President and included in the National Budget

17. Determination of Education Budget for National Schools

18. Zonal and Divisional Office Provincial Department of Education MOE Treasury National Budget *Zonal and Divisional Offices assess needs *The Provincial Department of Education forwards the requests to MOE *Subject Directors prepare budget plan for national schools *National Budget Committee prepares budget for national schools *Initial discussions held with the Treasury *Budget ceilings are decided *Once ministry budget is agreed upon, it is put to National Budget

19. Determination of Special Budgetary Items Recurrent Expenditure Items common to all schools: Welfare items –e.g., uniforms, text books, meals and grade 5 scholarships Quality Inputs

20. North and East No direct provincial bodies Requests are directly received from zonal directors of education and processed by the Finance Commission

21. Presentation outline Introduction to education finance in Sri Lanka Education Administration Structure in Sri Lanka The budgetary process Budget Implementation and monitoring Non-public sources of funding

22. Budget Implementation and Monitoring Implementation Actual Education budget decided according to the ceiling given by the Treasury Some flexibility to move funds between budget items Monitoring Reporting

23. Other Sources of Education Funding Alumni associations Fund raising activities Special projects funded by foreign donors

24. Issues Involvement of stakeholders is limited in deciding school level budgets Complex several layer administrative structure. Although needs identified at the school level, budget allocations are prepared after discussion at higher levels Budgets prepared due to historical trends rather than present needs – due to procedural shortcomings and budget limitations Budgets prepared according to guidelines by the Finance Commission and the Treasury – little flexibility for needs outside these guidelines Major portion of funds goes to essential recurrent items. Development related funding takes a back seat – e.g., teacher training

25. Issues – Contd. Equal fund allocations does not lead to equal outcomes (e.g., quality inputs) Privileged schools are better able to make use of available funds (better access to markets, better management, better and adequate teachers) Teacher shortages in difficult areas. No incentives to make teacher serve in difficult areas Not enough funds for maintaining schools. Underprivileged schools are less able to raise their own funds for maintenance etc.

26. Issues – Contd. Limited Information Information on budget allocation available. But not enough information on equity and efficiency of education finance. Also little information on efficient use of funds Funds are allocated according to utilization capacity (of a ministry, or a school) This makes the divide between the privileged and under-privileged schools wider