Sources and Patterns of Education Sector Financing: Options and Challenges in Bangladesh

Abstract

Bangladesh’s education system depends heavily on public financing both for recurrent and development expenditures. One major exception is secondary education where there is significant private financing. Though education is by far the largest recipient of Budgetary funds in combined Annual Development Program (ADP) and recurrent budgets, the total government expenditure on education is currently about only 2.5 percent of GDP and 14.2 percent of total government spending (BANBEIS 2008 and Human Development Report 2007/2008).The expansion of primary education took place both within and outside the public sector, while the rapid expansion of secondary education occurred mainly through partnerships with private providers. The large expansion in primary enrollment eventually resulted in increased demand for continuing into the secondary level. To achieve rapid expansion of secondary enrollment, the Government should opt more seriously for even wider partnership with the private sector, which will allow lower per-pupil costs. A high share of government education expenditure at all levels is directed to teachers' salaries and salary-related subsidies to non-government institutions. Salaries and salary-related subsidies accounted for 97 percent of recurrent expenditure at the primary level and 80 percent at the secondary level. Thus little funding is available for other inputs such as teaching materials supplies, in-service training, and maintenance. Construction is another large item in education budgets. In tertiary level the allocation for research is really disappointing. The Government should increase substantially the non salary budget for education sector.