Jaitley slashes education, health spending

While Bharatiya Janata Party (BJP) came to power promising to increase spending on health and education, Finance Minister Arun Jaitley has actually reduced the proposed spending on both these crucial sectors for the financial year 2015-16.

Presenting the first full budget of the government, Jaitley reduced spending on education by 16% and health by 15%.

Allocation of plan funds for states was increased in the last budget but the total plan allocation has come down by 19% for this year.

This implies lesser funds for development in the hands of states despite higher devolution of funds.

IndiaSpend had earlier raised concerns about low spending on education and health.

	Actual 2013-14			Budget 2014-15			Revised 2014-15			Revised 2015-16
	Plan	Non-Plan	Total	Plan	Non=Plan	Total	Plan	Non-Plan	Total	Plan	Non-Plan	Total
Department of School Education and Literacy	43684.41	3171.93	46856.34	51828	3287.1	55115.1	43517.9	3287.1	46805	39038.5	3181	42219.5
Department of Higher Education	14182.83	10282.34	24465.17	16900	10756	27656	13000	10700	23700	15855.26	11000	26855.26
	57867.24	13454.27	71321.51	68728	14043.1	82771.1	56517.9	13987.1	70505	54893.76	14181	69074.76

Source: Budget 2015, Figures in Rs crore

 

Education spending in India has been lower than the world average. Globally, 4.9% of GDP was spent on education in 2010 while India spent only 3.3% of GDP, according to World Bank data.

Compared to BRICS nations, India’s literacy rate is only 74% while that of these economies is equivalent to that of the developed world.

While the government is stressing on skill development, the spending on school education and literacy has been reduced by Rs 12,895.6 crore.

The Finance Minister has promised a school within a 5 km radius of every child but the fall in allocation, it may be a difficult target to achieve.

A similar reduction has been made for the Ministry of Health and family welfare, which has seen its outlay reduced by Rs 5,897.5 crore.
 

Actual 2013-14			Budget 2014-15			Revised 2014-15			Budget 2015-16
	Plan	Non-Plan	Total	Plan	Non- Plan	Total	Plan	Non- Plan	Total	Plan	Non- Plan	Total
Department of Health and Family Welfare	22476.59	4668.7	27145.29	30645	4518	35163	24400	4642	29042	24549	5104	29653
Department of Health Research	569.62	304.46	874.08	726	291.67	1017.67	610	322	932	713.17	305	1018.17
Department of AIDS Control	1473.15		1473.15	1785		1785	1300		1300	1397		1397
Total	24519.36	4973.16	29492.52	33156	4809.67	37965.67	26310	4964	31274	26659.17	5409	32068.17

Source: Budget 2015, Figures in Rs crore

While the election promise was to increase healthcare funding to 3% of the GDP, allocation has been reduced in 2015-16 and spending on public health will be reduced by 8% while funds for National Health Mission is reduced by 20%. Also, overall spending cuts have resulted from slashing of funding in planned funding.

The Asian Tiger economies did not compromise on education and health to build strong human capital. These economies had followed mixed policies of free markets but strict government control on the development of the social sector.

While India is on a stable growth trajectory, we still lag behind in human capital and overall human development where India ranks 136 among 186 countries.
Indiaspend.org is a data-driven, public-interest journalism non-profit