Since 2004, India’s education budget has more than doubled, increasing from Rs. 83,564 crore in 2004-05 to Rs. 1,91,946 crore in 2009-10. About 50% of this budget has been spent on elementary education. For the same period, ASER has been tracking learning outcomes to find that learning levels have remained depressingly stagnant. Nearly half the children in standard 5 are still unable to read a standard 2 text. This problem is not unique to education. Almost every social sector program in India suffers the same fate. What explains this status quo? Why have increased outlays failed to translate in to improved outcomes?

The crux of the problem is well known – India’s delivery systems are writ large with administrative inefficiencies that make accountability for outcomes near impossible.  The result: a system with high implementation costs and serious leakages so much so that only a small fraction of development monies reach their intended beneficiary.

Despite widespread recognition of the problem, there is surprisingly little empirical data and analysis on the specific processes by which outlays translate in to action on the ground. Very little is known in the public domain about planning processes and mechanisms through which expenditure priorities are determined – particularly at the district level. Following on from this, information on fund flows- the processes through which monies flow through the system and arrive at their final destinations – is scarce and perhaps even harder to get to than an analysis of planning process (for a detailed analysis of the difficulties with accessing information see last year’s PAISA report).  Curiously, this information is hard to access not just for citizens but also for policy makers and decision makers within the system. And so, plans are made without adequate data and consideration of local realities, needs and priorities. Consequently, we have a delivery system where annual plans are poorly designed, expenditure priorities are not grounded in local needs and inefficiencies of one year simply translate on to the next.

A second consequence of this lack of information and data is that parents, who are often part of local committees tasked with managing funds, making plans and monitoring the day to day functioning of service providers, are unable to engage effectively, identify expenditure priorities and demand accountability from schools. Moreover, the absence of data and information also creates disincentives for participation and a lack of ownership further compromising accountability for outcomes.

The PAISA exercise is located in this larger framework of outlays and outcomes. It is an effort to use information on expenditures as a starting point to engage citizens and policy makers with data on processes such as fund flows and on the ground expenditures which can be leveraged to improve the planning process. In its essence PAISA is an exercise that tries to connect the micro (local level implementation) with the macro (national level resource allocation decisions).

PAISA’s current focus is on elementary education. Tracking school grants (through reports like this one) is the first step. Our objective is to create a data bank on how monies flow through the system with a view to a) highlighting inefficiencies and bottlenecks for macro level policy makers to take cognizance of b) sharing information on school level expenditures on the ground with parents and frontline service providers to encourage a process of effective planning and engagement at the school level.

Over time, PAISA aims to track fund flow and decision making process all the way from the school to the district (where annual work plans are made) to develop a broader understanding and data base of what happens once a program hits the ground. The overarching aim of this work is to encourage greater transparency in governance processes particularly financing and planning and thereby strengthen the delivery system. But most of all, it hopes that by providing data and building capacity amongst citizens and frontline service providers to use PAISA and like tools to regularly collect such data, PAISA can begin a process of strengthening greater leadership and innovation on the ground. Through this PAISA hopes to plant the seeds for creating a delivery system that is bottom up, grounded in innovation and truly reflective of people’s needs and priorities. It is PAISA’s hypothesis that such a system holds the key to improved outcomes for service delivery.

A final note on where PAISA stands today. In 2010, PAISA underwent a significant expansion.  Apart from the annual PAISA report prepared in conjunction with the ASER process, PAISA is now undertaking in-depth tracking exercises in 10 districts spread across 7 states in the country. These tracking exercises will enable a far more detailed analysis (one that is not feasible in a national survey at the scale of ASER) of fund flows and school level processes. Importantly, in these districts our focus is not just on SSA but also on state level schemes (the extended tool is available in an annexure in this report). The effort is to develop tools and a data base of fund flows, institutional processes and decision making structures at the block and district level. As we proceed, we hope to extend our mandate in these districts beyond education to other key social sector schemes. Apart from tool development and data collection, PAISA is undertaking an experimental effort to leverage its data bank on fund flows to strengthen planning process. The School Management Committee is the first level at which this work is being undertaken. Lastly, we are working to build a network of people that can use PAISA tools and engage with the questions of process and implementation of government programs. To this end, PAISA is developing a capacity building course. The course is currently being administered with the PAISA Associates. This course is PAISA’s small way of creating a movement of informed citizens and policy makers demanding accountability for improved services.

[1] Director, Accountability Initiative, CPR