Education Expenditure as Percentage of GDP

Public expenditure on education lies on the fringes of 2 percent of GDP of this nation. However, in 2009 the government approved the new national education policy, which stipulates that education expenditure will be increased to 7% of GDP, an idea that was first suggested by the Punjab government.

The author of an article, which reviews the history of education spending in Pakistan since 1972, argues that this policy target raises a fundamental question: What extraordinary things are going to happen that would enable Pakistan to achieve within six years what it has been unable to lay a hand on in the past six decades? The policy document is blank on this question and does not discuss the assumptions that form the basis of this target. Calculations of the author show that during the past 37 years, the highest public expenditure on education was 2.80 percent of GDP in 1987-88. Public expenditure on education as a percentage of GDP was actually reduced in 16 years and maintained in 5 years between 1972-73 and 2008-09. Thus, out of total 37 years since 1972, public expenditure on education as a percentage of GDP either decreased or remained stagnant for 21 years. The author argues if linear trend were maintained since 1972, Pakistan could have touched 4 percent of GDP well before 2015. However, it is unlikely to happen because the levels of spending have had remained significantly unpredictable and unsteady in the past. Given this disappointing trajectory, increasing public expenditure on education to 7 percent of GDP would be nothing less than a miracle but it is not going to be of godly nature. Instead, it is going to be the one of political nature because it has to be "invented" by those who are at the helm of affairs. The author suggests that little success can be made unless Pakistan adopts an "unconventional" approach to education. That is to say, education sector should be treated as a special sector by immunizing budgetary allocations for it from fiscal stresses and political and economic instabilities. Allocations for education should not be affected by squeezed fiscal space or surge in military expenditure or debts. At the same time, there is a need to debate others options about how Pakistan can "invent" the miracle of raising education expenditure to 7 percent of GDP by 2015.