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Saturday, November 3, 2012

Right to Education: A voucher-based system for transferring funds to the deserving will be more democratic

The Right to Education (RTE) Act promises free and compulsory education to each and every child, to be delivered by the central and state governments, with the help of families and communities.

The immediate question that arises is whether to fund students or schools? If schools are funded, then the basis and proofs of admission of the 25% remains a challenge. If students are funded, then the challenge is to establish intended usage by children or their parents.

Although there exist several delivery mechanisms for transfer of funds - in bank accounts, by bank drafts or by cash - each has its own merits and demerits: for example, not all beneficiaries will have bank accounts, writing of cheques/drafts and the logistics involved in delivering the same and, of course, the possibility of cash being siphoned.

Appropriate back-end systems and MIS that can provide reliable and timely information related to identification of appropriate beneficiaries for corresponding neighbourhood schools, admissions, reimbursement, record maintenance, students transfer as well as learning assessment are other missing pieces of the puzzle.

Unwillingness of high-end private schools to accept the provision of 25% reservation ended on April 13, 2012, when the Supreme Court upheld the constitutional validity of the RTE reserving 25% seats for poor students in government and private unaided schools, except minority institutions. The need of the hour is a transparent, simple, fair, accountable and easy-to-implement system that ensures implementation of this revolutionary Act in its correct spirit.

One simple, yet innovative solution can be use of specialised and secure voucher system for education. Studies have shown that education vouchers do help in enhancing access and quality, especially for the needy families. Further, it introduces more accountability and transparency in all stakeholders: governments, schools and students, thereby raising the quality of governance. Vouchers are extremely helpful in allocating convenience and benefits to citizens at large. As a payable instrument, it has evolved and resonated into a secure, accountable and transparent mechanism that delivers benefits under public social programmes: be it education, public distribution system or health. So, let's understand the functionality of vouchers in the education sector.

Basically, an education voucher delivered directly to beneficiary family empowers the deprived students by providing them with an opportunity to enrol in a school of their choice. The money spent by governments on government schools is converted into education vouchers and distributed directly among the poor students. Instead of funding schools, the government funds students. Therefore, universalisation of school access and education is ensured. The government schools that are able to attract students get funded based on the number of vouchers (students) they are able to produce. The funding to the school is not automatic and arbitrary but based on the number of students that government schools have.

All the schools' resources are automatically linked to this and it automatically introduces competition among the government schools, thereby introducing competition and enhancing quality of education. Similarly, under the RTE provisions, students from the economically-backward and weaker sections get an opportunity to study in private schools as well. As a result, the underprivileged get the equality of choice as the rich and this choice of the poor increases competition in the education sector. The private schools are also motivated by the fact that vouchers provide them with complete transparency about their reimbursement and that uncertainty about their payment mechanism is removed.

Thus, the combination of choice and competition provide universal access and higher quality of education to all. The education voucher system provides for a system that is absolutely evidence-based.

Many benefits like school textbooks, school uniform, bicycles to eligible students, scholarships for particular usage, etc, can also be administered through this mechanism of evidence-based usage system.

Many countries have seen drastic changes after the introduction of education vouchers. Sweden has actually converted its school education into a universal voucher system where every child, irrespective of parental income, gets a voucher to go to a school of her choice among private or government schools. Ticket Junaeb in Chile and Dote Scoula in Italy are other examples. 
( By: Sandeep Banerjee, MD & CEO, Edenred India in The Economic Times, 3 Nov, 2012)

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