Addressing Financial Needs

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Addressing Financial Needs
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What is the best investment we can make for
Indias future?

• The development of children is the first
  priority on the countrys development agenda, not
  because they are the most vulnerable, but because
  they are our supreme assets and also the future
  human resources of the country
• -Tenth Five year Plan

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Are we spending enough?

• On all sectors?
• Are the spending patterns support/ facilitate the
  lateral synergistic relationship that exist/
  evident across the different sectors/ sub-sectors
  of Human / Child development?
• At All stages of Development?
• Are the spending patterns show any evidence of
  support/ facilitating to the vertical (continuous
  cumulative nature of the process of child
  development, with every preceding sub-stage tends
  to set the readiness level for the next stage,
  thus reduce the investment costs of subsequent
  stages corrective measures?
• In all States?

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Budgeting for children- 3 Imbalances

• Intra-sectoral spending
• Intra- stage spending
• Intra- regional spending
• Difficult to disaggregate data for children
  separately Most programs are for mother and
  child

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Sectoral spending on Children in Union Budget
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Underutilization of central government funds for
child development (in Rupees at constant prices)
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ICDS expenditure per Beneficiary Child
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Per Child Expenditure Under ICDS (2001-2002)
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Resource Gap in SNP allocation of funds
Source Annual Report 2001-02, Planning
Commission, Government of India
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Gap in Resource Utilization of ICDS funds
utilized 2001
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Percentage share of elementary education in
education expenditure
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Trends In The Expenditure On Elementary Education
In The 1990s (In Rupees, Millions, Constant
Prices)
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Comparative Per Child Expenditure On Children
Below 6 Years And 6-14 Years
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Per Child and Per beneficiary Child expenditure
How it is camouflaged by actual reach
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Critical Period In Brain Development Financing
Gap
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• Spending on Children - Only lt2 of Central
  governments budget
• State government spends on an average 10 of
  their total budget on children
• But this camouflages a wide range
• Substantial component of this spending is on
  salaries
• Little scope for investment in areas that would
  improve targeting and service delivery
• Together, centre and state spends around 2.26 of
  the GDP on children

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Concern

• Spending mostly on Primary education - Health,
  nutrition not getting enough compared to
  education
• Wide imbalances with regard to relative spending
  on children below 6 years and that for the 6
  years
• Not all money allocated is spend
• Some of the states with the poorest CD indicators
  may need more, but actually they spend less and
  in the process, get less in the next cycle of
  allocation, suggesting a perpetuation of a
  vicious cycle of low resources and slow
  development.
• 20 million children in the country below 11
  years US 1.8 per child per month!

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Concerns all the more relevant because it takes
place in the context of

• A fragmented, sectoral approach in implementing
  the schemes, which does not capture the synergies
  across sectors
• Over-centralised and standardised program
  designs which do not address contextual
  diversities
• Low accountability
• Poor service delivery
• Inefficient program implementations
• Inadequate monitoring capacity

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Financing issues in the context of service
delivery

• (Services fail the poor in 4 ways (WDR 2004))
• Spending on health and education of the govt
  increase, but spending on actual quality and in
  real terms is probably not enough
• Even when public spending is reallocated towards
  the poor, it often does not reach the frontline
  provider
• Service delivery is not regulated by carrots and
  sticks
• Lack of ownership among the community

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Government needs to continue as the dominant
provider for childrens development and education

• Considerations of equity and efficiency coupled
  with the constraints of limited resources and the
  need for maximizing welfare impact call for
  rational targeting of public resources fort he
  poorest of poor.

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What should be done w.r.t financing
When will it work?

• Adequate spending
• in all sectors
• at all stages of child development
• Investing in the very young child priority
• Targeting Public financing for Poor children
• All these being taken care of by states, which
  are laggards in outcomes.

• Approach for planning
• outcome-focused
• child-centered
• multi-sectoral
• demand driven community
• decentralized
• Improved targeting and monitoring
• Improved service delivery
• Making private sector more accountable
• Forging new partnerships

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• Along with enhanced funding, there is the need
  for governance and administrative reforms and
  greater focus in strengthening institutional
  capacity, greater accountability, focus on
  outcomes and most importantly, breaking
  perpetuating inequalities