Can we do better than “ The RTE Act ” ?

By Ashish Puntambekar

Ever since the Supreme Court order on the 12th of April, upholding the RTE Act, there has been huge uncertainty and panic within the school system in India with both school managements and parents very worried about the implications of the courts order. Schools are worried that it will ruin their finances and parents are panicking at the thought that schools across the nation might cancel admissions for the coming year to comply with the 25 % quota requirement.

The unstated question in peoples minds is “ Is there a better way than the RTE Act ? “

Introducing “ The Indian Education Megaproject ”

Stakeholders in schools across India may be pleasantly surprised to learn that in June 2010, a landmark project “ The Indian Education Megaproject “ with a capacity to provide high quality education, totally free of cost to 126 Million children had been submitted to the Ministry of HRD and the Planning Commission.

The Education Megaproject envisages the construction of a massive system of 30,000 New Hub Schools under Public Private Partnership, across 28 states and 7 Union Territories. Each of these Hub schools will in turn share its teachers with 14 other smaller schools within a radius of 50 Km thereby covering an additional 420,000 Schools nationwide.

The Megaproject has a Teacher Centric concept as against the current Sarva Shiksha Abhiyaan ( SSA ) which is literacy centric. This essentially means that in order to attract qualified people the Education Megaproject provides attractive inducements : Good Salaries for teachers, Excellent Housing, and Free Healthcare. The central idea being that if we can motivate qualified people to take up careers in education, Universal literacy will follow by itself.

System of 18 Million Vouchers

The Megaproject focuses on the poorest children by introducing a system of 18 Million Vouchers which are allotted by means of a simple aptitude test administered nationwide. For the same score, the voucher will favour the disadvantaged child by using an inverse algorithm which takes into account the

child’s education history and family income. The New Hub schools will be overstaffed with twice the number of teachers required to enable sharing with other smaller village / slum schools in its area. Each voucher will therefore pay for the education of 6 other children ( in addition to the winner of the voucher ), to achieve a coverage of 126 Million Children across India.

The cost of educating each child, despite a much higher quality level, within the proposed Megaproject system, is comparable to that which is currently achieved within the SSA. Most importantly the Megaproject creates massive New Capacity while the RTE act on the other hand leaves New School Construction to the individual states. In fact, the RTE Act destroys the economics of existing schools and discourages the building of new schools by private parties.

To quantify the massive beneficial impact, the Megaproject has been evaluated against expected RTE Act outcomes within the prevailing School system on 12 key parameters.

1. Additional Capacity Creation : The Education Megaproject adds 30,000 New schools ( each with 600 seats ) under Public Private Partnership and upgrades 420,000 existing SSA schools by sharing its qualified Teachers. The RTE Act actually does the opposite, by not fully reimbursing 25 % quota implementation costs it destroys the finances of private schools thereby discouraging further private investment.

2. New Teachers Recruitment and Training : Govt. of India is still not clear where it will find the 1.2 Lakh teachers to implement the RTE. The Education Megaproject on the other hand will execute a massive plan to induct and train 17.4 Lakh New Teachers. The project will deploy 10,000 search consultants to find suitable people from other professions and back up the recruitment drive with a Rs. 800 Crores advertising budget. Once the people are found they will be trained in 500 New Teacher Training institutes set up under Phase I.

3. Focus Area : Under RTE, Govt is not thinking beyond Class VIII. In comparison the Megaproject accommodates all children who do not have a school. Its real focus however is class V to class XII where there is a huge shortage of over 5.5 Lakh secondary schools.

4. Capital Cost : Under RTE, the Central Govt. has abdicated responsibility by leaving the job of setting up of new schools to State Governments. The Megaproject is the exact opposite. It is a centrally sponsored scheme that will invest Rs 6 Lakh Crores over an 8 – 10 year construction period. In doing this it will also create 2 Million new Jobs in the construction phase and catalyze another 4 million new jobs nationwide by 2030.

5. Operating Cost : The RTE has an Operating cost of Rs. 2.3 Lakh Crores each year. Over the next 30 years it will cost the Union Budget Rs 69 Lakh Crores

( without discounting ). The Education Megaproject is however engineered to generate most of its yearly Opex of Rs. 1.93 Lakh cores its internal Financing structure. It will need only Rs. Sixteen Thousand Crores each year from the Union Budget. Over a 30 year period, its cost to Govt. of India will be Rs 4.8 Lakh

Crores. Much lesser than the current RTE plan.

6. Sources Of Finance : As opposed to the RTE Act which will get all its 2.3 Lakh crores from the Union Budget, the Education Megaproject has 14 different and innovative pools of Finance, including (1) US $ 15.6 Billion currently lying un-utilized with the World bank / ADB, (2) Increasing FSI’s on PSU land and auctioning some of this FSI to raise US $ 40 Billion etc. The important thing here is that the entire Capital cost of 6 Lakh Crores will be raised without a single paise coming from the Union Budget or the State Government Budgets. The innovation in this project is therefore in its financing. The detailed 50 page financing document is available for free download on the following link. http://www.nataraja.org.in/site_includes/documents/Indian%20Education%20Megaproject_Financing_Structuring_And_Control_Concepts.pdf

7. Capacity of Accommodate Disadvantaged Children : The current RTE plan caters to 8 – 10 Million disadvantaged children. The Megaproject on the other hand has been designed for 126 Million Children because Govt. planners have not properly counted tens of millions of children.

8. System Of Selection : The RTE Act leaves the identification of poor children to the Block Development Officer. This will create massive corruption as Poverty Certificates will now be auctioned. The Megaproject avoids this by implementing a system of 18 Million Vouchers which will be won through a simple aptitude test. For the same score on the test , a disadvantaged child will be given a preference. Scope for Corruption in this system is Zero.

9. Programme Control and Monitoring : The RTE Act and the current Govt. school system, lacks a proper system to monitor quality and compliance. The Megaproject instead executes a large IT system that floats on a massive and sophisticated Computer network making all decisions totally transparent and visible. The Voucher System Algorithms will generate systemic alerts when specific triggers are hit or when decisions are not taken within specified time limits. System will be decentralized at state level and will allow granular and drill down functionality to the village school level.

10. Annual Cost Per Child : Implementing the RTE Act will cost the Govt. Rs. 12000 per child per year. For the Education Megaproject this number is Rs 14,490.

11. Quality of Education : The RTE Act will further ruin education quality as 46 % of India’s 4.7 Million Teachers have not studied beyond class XII. In Bihar just 21 % of teachers have passed their class X exams. This has happened mainly due to a Literacy centric mindset in the SSA system. In comparison, the Megaproject

will deliver very high performance by sharing it 17.4 lakh Graduate Teachers backed by a massive IT Network to reach remote villages. In addition, the project has a huge, IT driven, adult literacy evening programme to include people who have missed out over the last 20 years.

12. Project Objective : The Megaproject has a clear objective of constructing School Infrastructure and preparing human resources needed to support a US $ 4.5 trillion economy in India by 2025. The RTE act, though based ostensibly on the very noble objective of social inclusion is in fact a populist scheme with no clear vision in its execution.

Education Megaproject Financing & Startup Issues

Education is a state subject and since the states do not have adequate resources, the financing for this project will be enabled by central legislation and through a financing structure that the Vajpayee led NDA government first deployed to build the Golden Quadrilateral Project. They also set up a Special Purpose Vehicle (SPV), named the National Highways Authority (NHAI) to do the construction work.

The Education Megaproject uses the same structure as Govt. of India is already very familiar with it. The only difference is that instead of a special tax on Diesel and Petrol that was adopted for financing the Roads system, the education project will use 14 different financing sources which are totally new, such as using money lying un - utilized with the World Bank for example. The only thing left to do then, to get the Education Megaproject off the ground is to get Parliament to pass two separate Acts as follows :

1. The Indian Social Infrastructure Corporation Act

2. The Education Megaproject Fund Act

The first Act will set up an SPV to construct the project while the second act will enable the raising of money from 14 un-conventional sources of finance. It needs to be mentioned here that since Education generates massive demand within an economy, even printing money to finance schools, is in theory at least, non inflationary. The Education Megaproject however, is an excellent scheme based on innovative financing that besides creating 2 million new jobs during its construction phase and nearly 3 million new jobs during its operations phase is also a huge GDP and investment Multiplier. It is very different from the RTE Act which though good in its intention is retrogressive and un-imaginative in its execution

Forward Path

A total of 70 Pilot projects are planned with two pilot schools including a teachers training institute in each state and Union Territory to test various systems before mass rollout in 2014. Simultaneously, steps will be initiated to launch the first of four bidding rounds which by June 2014, will offer 6000 New Hub schools on PPP basis to private parties as part of Phase I.

The supreme court was very right in upholding the RTE act as it stands for Equality of Opportunity. But given the inertia we have within government, it may be necessary for School Associations, Parent Groups and Civil Society to approach the apex court once again to plead for the Education Megaproject as it is a market friendly scheme in the public interest.

Those interested in the Education Megaproject and its ideas are invited to download all the projects detailed plan documents, Project Presentation and calculations from the Nataraja Foundations website.

http://www.nataraja.org.in/masseducationproject.htm

Senior Responses to the project from The Planning Commission and other organizations is on the following link.

http://www.nataraja.org.in/site_includes/documents/Responses%20To%20Indian%20Education%20Megaproject%20_%20Upto_March_2011.pdf

About the author :

Ashish Puntambekar is the designer of the Education Megaproject. He is currently employed as a Corporate Planner and Project Designer at a fortune 500 company. He is also trustee of the Nataraja Foundation, an NGO set up to help plan and execute this massive project. Views expressed are personal.