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Sri Lanka - Institut de statistique de l'Unesco

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Out-of-School Children in <strong>Sri</strong> <strong>Lanka</strong>: Country Study<br />

4.5 Financial allocations and educational expenditure<br />

A major constraint in the education sector is limited financial resources available for<br />

implementation of policies. This is not a new problem. However, government expenditure on<br />

education has <strong>de</strong>creased in recent years both as a percentage of GDP and as a percentage of<br />

the total government budget. Public expenditure on education as a percentage of GDP fell from<br />

nearly five percent in the late 1960s to 2–3 percent in the 1980s, and as a percentage of total<br />

expenditure from around 16 percent to eight percent over the same period, with the advent of<br />

structural adjustment programmes. Since then, it has <strong>de</strong>clined further from 2.7 percent of GDP<br />

in 2006 to 1.9 percent in 2010, and from 11 percent of total expenditure in 2006 to 8.1 percent<br />

in 2010.<br />

Social protection is viewed largely in terms of the provision of free state education and health<br />

services. These services have been complemented by welfare payments to some households<br />

un<strong>de</strong>r poverty alleviation programmes (two percent of total public expenditure) and through<br />

small-scale cash transfers offered to some families, for instance, by the Ministry of Social<br />

Services and the Department of Probation and Child Care (MOF, 2009). However, this has<br />

amounted to a very limited quantum of financial assistance. It has to be noted too that<br />

quantitative and qualitative improvement has <strong>de</strong>pen<strong>de</strong>d heavily on donor assistance in recent<br />

<strong>de</strong>ca<strong>de</strong>s from multilateral agencies such as the World Bank, Asian Development Bank, UNICEF,<br />

World Food Programme, UNFPA and UNESCO; bilateral agencies such as GIZ, JICA and DFID;<br />

and INGOs such Save the Children and Plan International. In the context of a lack of<br />

comprehensive information on the funds provi<strong>de</strong>d, it is only possible to estimate that donor<br />

contributions have ma<strong>de</strong> up about six percent of the total education budget.<br />

Since <strong>de</strong>volution to the provincial level, there have been two paths for financial allocations for<br />

recurrent and capital expenditure from the Ministry of Finance to the various levels of<br />

educational administration and to educational institutions. Funds are channelled to the central<br />

MOE to be allocated for administration at the national level, and through the Finance<br />

Commission for allocation to the provincial administrations. In the context of the wi<strong>de</strong> regional<br />

disparities that prevail in the country, the Finance Commission is expected to assist in meeting<br />

the needs of each of the nine provinces and to allocate funds to achieve balanced regional<br />

<strong>de</strong>velopment. It also accords priority to monitoring progress in enrolling OOSC in school<br />

(Finance Commission, 2009).<br />

Deviating from the tradition of allocating resources each year on a historical basis, the<br />

government, with assistance from the World Bank, introduced a norm-based unit cost resource<br />

allocation mechanism (NBUCRAM) in response to a suggestion by the National Education<br />

Commission. Since 2000, some funds have been allocated directly to schools for quality inputs<br />

according to this mechanism. Since 2006, the ESDFP, un<strong>de</strong>r its third theme of ‘increasing equity<br />

in the distribution of resources’, has implemented several new measures and has modified the<br />

formula in or<strong>de</strong>r to direct more resources to disadvantaged districts. This was accompanied by<br />

a move towards <strong>de</strong>centralization of financial authority to secondary schools through<br />

school-based grants for specific subjects.<br />

For more effective monitoring un<strong>de</strong>r the ESDFP, education officers and schools have been<br />

using a Results-Based Monitoring and Evaluation Framework. In addition, a Public Expenditure<br />

and Quality of Education Tracking System (PEQETS) is being gradually introduced. The impact<br />

of these monitoring tools is yet to be assessed.<br />

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