The World Bank’s recent flagship World Development Report, 2018 addressed some immediate challenges of quality education. One of the ways that it broke new ground was on the issue of provision for private education. Growing private school enrolment is a global trend and the phenomenon must be taken seriously and discussed on evidence.
Education systems in many countries are not performing up to expectation and many families have been turning to private schools since they feel that the latter deliver better education, especially when public schooling itself is not fully free. India too fails to provide free secondary public education.
However, the report highlights that research across 40 countries finds no difference in the learning outcomes of children with similar family backgrounds in both public and private schools. Private schools appear better since they enrol children from relatively advantaged backgrounds who are able to pay, not because they deliver better quality.
The World Bank report thus challenges a popular perception in India and finds no consistent evidence that private schools deliver better learning outcomes than public schools. Indeed, of the 1.27 million untrained teachers teaching in India, 925,000 are in private schools, pointing to the massive historic neglect of quality. States’ capacities to fully monitor and enforce adherence to quality standards, mitigate against negative equity impact and ensure contract compliance must be enhanced if justice is to be done to those who already study in private schools.
The report warned that some private schools’ quest for profit “can lead them to advocate policy choices that are not in the interests of students”. In some instances, private schools may indeed deliver comparable learning outcomes with lower input costs, but this is achieved largely through lower teacher salaries. The report reiterated that while this may make education cheaper, it does not make it better, and has the additional disadvantage of reducing the supply of qualified teachers over time.
The quality of education can only be improved if steps are taken to ensure children come to school prepared to learn, teachers have the skills and motivation to teach effectively, inputs reach classrooms and management and governance systems are strengthened in schools that serve the poorest. Other research on the issue, such as the recent report by the Global Campaign for Education, suggests that learning outcomes are poor in both.
There are also clear risks as private schools skim off higher-income students that are easiest and most profitable to teach, leaving the most disadvantaged within the public system. The reliance on private schools risks segregating the education system on family income and deepening existing social cleavages; it also undermines the political constituency for effective public schooling in the long run.
This has particularly dangerous outcomes in India where caste, gender and class inequalities dominate. Indeed, recent research from India suggests that the gender gap in private enrolment may be on the rise, even as it is reducing in government schools. Data for relatively richer countries also shows that systems with low levels of competition have higher social inclusion and that upward social mobility is higher in government systems.
Despite this evidence, and given the scale of the challenge of delivering quality education for all, governments have progressively looked to the private sector for support. However, mechanisms to track the quality of education in private schools have historically tended to be weak or absent, even in developed countries. Building this regulatory capacity requires significant financial and human resource investments. The report concluded that “overseeing private schools may be no easier than providing quality schooling” and that “governments may deem it more straightforward to provide quality education than to regulate a disparate collection that may not have the same objectives”.
India has taken some steps in the direction of developing regulatory frameworks for private schools, with several states enacting fee-regulation legislation and the courts intervening to challenge private sector failures.
Last month, the Supreme Court intervened to direct states to enforce guidelines on safety in schools; in January, it had to enforce fee regulation. Building regulatory capacities, however, is only one solution. The long-term solution lies in strengthening the public education system in its complexity and ensuring that all of India’s children receive quality education.
The government is set to unveil the first New Education Policy in 25 years in December 2017. It needs to address the key concerns and should focus on equity in quality—ensuring universal access to free, quality, equitable and safe public education for all of India’s young citizens. This alone would help achieve India’s aspirations of global leadership by tapping into the demographic dividend that India still enjoys. This must be backed by adequate resources. India is committed to the global and domestic benchmark of allotting 6% of gross domestic product to education, but has never crossed the 4% threshold. Failing to invest in the best education for the poor will only widen the social inequalities that exist in India today. The road to reform is fraught with challenges but the cost of inaction will be much higher.
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Petrol in India is cheaper than in countries like Hong Kong, Germany and the UK but costlier than in China, Brazil, Japan, the US, Russia, Pakistan and Sri Lanka, a Bank of Baroda Economics Research report showed.
Rising fuel prices in India have led to considerable debate on which government, state or central, should be lowering their taxes to keep prices under control.
The rise in fuel prices is mainly due to the global price of crude oil (raw material for making petrol and diesel) going up. Further, a stronger dollar has added to the cost of crude oil.
Amongst comparable countries (per capita wise), prices in India are higher than those in Vietnam, Kenya, Ukraine, Bangladesh, Nepal, Pakistan, Sri Lanka, and Venezuela. Countries that are major oil producers have much lower prices.
In the report, the Philippines has a comparable petrol price but has a per capita income higher than India by over 50 per cent.
Countries which have a lower per capita income like Kenya, Bangladesh, Nepal, Pakistan, and Venezuela have much lower prices of petrol and hence are impacted less than India.
“Therefore there is still a strong case for the government to consider lowering the taxes on fuel to protect the interest of the people,” the report argued.
India is the world’s third-biggest oil consuming and importing nation. It imports 85 per cent of its oil needs and so prices retail fuel at import parity rates.
With the global surge in energy prices, the cost of producing petrol, diesel and other petroleum products also went up for oil companies in India.
They raised petrol and diesel prices by Rs 10 a litre in just over a fortnight beginning March 22 but hit a pause button soon after as the move faced criticism and the opposition parties asked the government to cut taxes instead.
India imports most of its oil from a group of countries called the ‘OPEC +’ (i.e, Iran, Iraq, Saudi Arabia, Venezuela, Kuwait, United Arab Emirates, Russia, etc), which produces 40% of the world’s crude oil.
As they have the power to dictate fuel supply and prices, their decision of limiting the global supply reduces supply in India, thus raising prices
The government charges about 167% tax (excise) on petrol and 129% on diesel as compared to US (20%), UK (62%), Italy and Germany (65%).
The abominable excise duty is 2/3rd of the cost, and the base price, dealer commission and freight form the rest.
Here is an approximate break-up (in Rs):
a)Base Price | 39 |
b)Freight | 0.34 |
c) Price Charged to Dealers = (a+b) | 39.34 |
d) Excise Duty | 40.17 |
e) Dealer Commission | 4.68 |
f) VAT | 25.35 |
g) Retail Selling Price | 109.54 |
Looked closely, much of the cost of petrol and diesel is due to higher tax rate by govt, specifically excise duty.
So the question is why government is not reducing the prices ?
India, being a developing country, it does require gigantic amount of funding for its infrastructure projects as well as welfare schemes.
However, we as a society is yet to be tax-compliant. Many people evade the direct tax and that’s the reason why govt’s hands are tied. Govt. needs the money to fund various programs and at the same time it is not generating enough revenue from direct taxes.
That’s the reason why, govt is bumping up its revenue through higher indirect taxes such as GST or excise duty as in the case of petrol and diesel.
Direct taxes are progressive as it taxes according to an individuals’ income however indirect tax such as excise duty or GST are regressive in the sense that the poorest of the poor and richest of the rich have to pay the same amount.
Does not matter, if you are an auto-driver or owner of a Mercedes, end of the day both pay the same price for petrol/diesel-that’s why it is regressive in nature.
But unlike direct tax where tax evasion is rampant, indirect tax can not be evaded due to their very nature and as long as huge no of Indians keep evading direct taxes, indirect tax such as excise duty will be difficult for the govt to reduce, because it may reduce the revenue and hamper may programs of the govt.