Public Finance ASSIGNMENT
Public Finance ASSIGNMENT
Public Finance ASSIGNMENT
Assignment On:
Submitted To:
Assistant Professor
Finance Discipline
Submitted By:
Group - “D”
Name Student ID
Md. Emran Hossain 0222320004083016
Shajid Hasan Tanvir 0222320004083032
Sheik Arfat 0222320004083031
Chowdhury Isnuva Ajnin 2003220804017
Sharmista Sharker 0222320004083023
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Table of contents:
2 Objectives 2-3
3 Public Expenditure 3-5
4 Public Education Expenditure 5-12
4.1 The Education Budget: Process, Allocations and Utilization 5-7
in Bangladesh
4.2 Bangladesh: Education spending, percent of GDP 7-8
4.3 Bangladesh education spending compare to Asian sub- 9
continent countries
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“Evaluating the Effectiveness of Public Education Expenditure
in Improving Educational Outcomes.”
1. Introduction:
In an era marked by global competition and the relentless pursuit of economic development,
education stands as a cornerstone for individual advancement and societal progress. Recognizing
this, governments worldwide allocate substantial resources to public education, viewing it as an
investment in human capital and a catalyst for socioeconomic growth. However, the mere
allocation of funds does not guarantee improved educational outcomes. Thus, understanding the
effectiveness of public education expenditure in achieving its intended goals becomes
imperative.
The effectiveness of public education expenditure hinges on its ability to translate financial
investment into tangible improvements in educational outcomes, such as student achievement,
literacy rates, graduation rates, and overall educational attainment. This topic delves into the
multifaceted nature of evaluating the impact of public education spending, exploring various
dimensions, methodologies, and challenges inherent in assessing its effectiveness.
At its core, evaluating the effectiveness of public education expenditure requires a nuanced
examination of inputs, processes, and outcomes. Inputs encompass the financial resources
allocated to education, including government spending on infrastructure, teacher salaries,
curriculum development, and student support programs. Understanding how these inputs are
distributed across different educational sectors and regions sheds light on equity considerations
and resource allocation efficiency.
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However, the ultimate litmus test of public education expenditure lies in its impact on
educational outcomes. This entails assessing changes in student performance, learning outcomes,
and educational attainment attributable to increased investment in education. Key indicators such
as standardized test scores, graduation rates, literacy levels, and enrollment rates serve as
benchmarks for gauging the effectiveness of public spending in driving educational
improvement.
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V. Evaluate the quality and relevance of educational inputs supported by public expenditure,
such as teacher training, curriculum development, instructional materials, and school
infrastructure.
VI. Examine the long-term economic and social returns on investment in education, including
its impact on workforce productivity, poverty reduction, social mobility, and overall
societal well-being.
3. Public Expenditure:
Public expenditure refers to the spending made by the government on various goods and services
to fulfill its obligations and meet the needs of the public. It plays a crucial role in driving
economic development, promoting social welfare, and ensuring the provision of essential
services. Public expenditure encompasses a wide range of activities, from funding infrastructure
projects to providing healthcare, education, defense, and social security. Understanding the types
of public expenditure provides insights into the priorities and functions of government spending.
Here are the broad categories of public expenditure:
A. Current Expenditure:
Current expenditure, also known as recurrent expenditure, refers to spending on day-to-day
operations and maintenance of government services and programs. This includes salaries and
wages of public employees, administrative expenses, utility bills, consumable supplies, and
routine maintenance costs. Current expenditure is essential for the smooth functioning of
government agencies and the delivery of public services.
B. Capital Expenditure:
Capital expenditure involves spending on long-term assets and infrastructure projects that
enhance the productive capacity of the economy and improve the quality of life for citizens.
Examples of capital expenditure include investment in roads, bridges, railways, airports,
schools, hospitals, water supply systems, and public utilities. Capital expenditure contributes
to economic growth by stimulating employment, boosting productivity, and attracting private
investment.
C. Social Expenditure:
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Social expenditure encompasses spending on social welfare programs and services aimed at
addressing the needs of vulnerable and disadvantaged groups in society. This includes
expenditures on healthcare, education, housing, social security, unemployment benefits,
pensions, and welfare assistance. Social expenditure plays a vital role in reducing poverty,
inequality, and social exclusion, as well as promoting human development and well-being.
D. Defense Expenditure:
Defense expenditure refers to spending on national defense and security, including military
personnel, equipment, operations, and defense-related research and development. This
expenditure is aimed at safeguarding national sovereignty, protecting territorial integrity, and
ensuring national security in the face of external threats. Defense expenditure is often a
significant component of government budgets, particularly in countries facing geopolitical
challenges or security risks.
E. Interest Payments:
Interest payments represent the cost of servicing government debt, including interest on
loans, bonds, and other forms of borrowing. Governments incur interest payments as they
borrow funds to finance budget deficits, invest in infrastructure projects, or cover operating
expenses. High levels of interest payments can strain government finances and crowd out
spending on other priority areas, such as social welfare or infrastructure development.
F. Transfers and Subsidies:
Transfers and subsidies involve payments made by the government to individuals,
households, businesses, or other levels of government to support specific activities or achieve
policy objectives. This includes social transfers such as welfare benefits, food assistance, and
subsidies for essential goods and services like food, fuel, electricity, and public
transportation. Transfers and subsidies are often used to redistribute income, alleviate
poverty, and stimulate economic activity in targeted sectors.
G. Development Expenditure:
Development expenditure refers to spending on projects and programs aimed at promoting
economic development, regional growth, and infrastructure expansion. This includes
investments in transportation, energy, telecommunications, agriculture, industry, tourism, and
urban development. Development expenditure plays a crucial role in fostering sustainable
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economic growth, reducing regional disparities, and improving living standards for the
population.
Understanding the composition and allocation of public expenditure provides insights into
government priorities, policy objectives, and the broader socioeconomic context in which public
finances operate. Effective management of public expenditure is essential for achieving
sustainable development, promoting social equity, and enhancing the overall well-being of
society.
Budget Process:
Preparation: The education budget is prepared annually by the Ministry of Education in
consultation with relevant stakeholders, including education experts, policymakers, and
representatives from educational institutions. The budget preparation process involves
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assessing the current needs and priorities of the education sector, as well as projecting
future requirements based on demographic trends, policy goals, and development plans.
Approval: Once the education budget is prepared, it is submitted to the Ministry of
Finance for review and inclusion in the national budget proposal. The budget proposal
undergoes scrutiny by the government's budgetary authorities, including the Finance
Division and the Planning Commission, before being presented to the parliament for
approval.
Allocation: After parliamentary approval, the education budget is allocated to different
components within the education sector, including primary, secondary, higher, and
technical/vocational education. Allocations are also made for teacher salaries,
infrastructure development, curriculum reform, student scholarships, and other
educational programs and initiatives.
Implementation: The allocated funds are disbursed to relevant education authorities,
including the Directorate of Primary Education, Directorate of Secondary and Higher
Education, and Directorate of Technical Education, for implementation of various
education projects and programs. Monitoring and evaluation mechanisms are put in place
to ensure efficient utilization of funds and adherence to budgetary guidelines.
Allocation Priorities:
Primary Education: The government prioritizes investment in primary education to
ensure universal access and quality education for all children. Allocations are made for
the construction of new schools, recruitment and training of teachers, provision of free
textbooks and other learning materials, and improvement of school facilities.
Secondary Education: Funding for secondary education focuses on expanding access to
secondary schools, enhancing the quality of education, and improving student outcomes.
This includes investments in curriculum development, teacher training, infrastructure
upgrades, and the provision of stipends and scholarships for students from disadvantaged
backgrounds.
Higher Education: Allocations for higher education support the development of
universities, colleges, and vocational institutions, as well as research and innovation
initiatives. Funding is provided for faculty development, academic programs,
infrastructure expansion, student financial aid, and research grants.
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Technical and Vocational Education: The government emphasizes investment in
technical and vocational education and training (TVET) to equip students with relevant
skills for employment and entrepreneurship. Allocations support the establishment of
polytechnic institutes, vocational training centers, and skill development programs in
collaboration with industry partners.
The education budget in Bangladesh reflects the government's commitment to improving
access to quality education and fostering human capital development. By prioritizing
investment in education and addressing implementation challenges, Bangladesh can enhance
the effectiveness of its education budget and achieve its goals of building a knowledgeable,
skilled, and competitive workforce for sustainable development and prosperity.
Bangladesh
Public spending on education, percent of GDP
For that indicator, we provide data for Bangladesh from 1979 to 2022. The average value for
Bangladesh during that period was 1.74 percent with a minimum of 0.94 percent in 1980 and a
maximum of 2.22 percent in 2016. The latest value from 2022 is 1.97 percent. For comparison,
the world average in 2022 based on 83 countries is 3.80 percent. See the global rankings for that
indicator or use the country comparator to compare trends over time.
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Recent values chart
Historical chart
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General government expenditure on education (current, capital, and transfers) is expressed as a
percentage of total general government expenditure on all sectors (including health, education,
social services, etc.). It includes expenditure funded by transfers from international sources to
government. General government usually refers to local, regional and central governments.
4.3. Bangladesh education spending compare to Asian sub-continent
countries:
As of last update in January 2022, here's a general overview of education spending in
Bangladesh compared to some other countries in the Asian subcontinent.
Bangladesh: Bangladesh has been increasing its education spending over the years.
According to data from the UNESCO Institute for Statistics, in 2022, Bangladesh allocated
around 2% of its GDP to education.
India: India, being one of the largest countries in the world, has varied education spending
across states. However, the overall education expenditure as a percentage of GDP has been
around 4.6% in recent years, according to World Bank data.
Pakistan: Pakistan's education spending has also been increasing but remains relatively low
compared to some other countries. As of 2022, Pakistan allocated approximately 2% of its
GDP to education.
Sri Lanka: Sri Lanka has historically allocated a relatively higher percentage of its GDP to
education compared to its neighbors. In recent years, education expenditure has been around
5% of GDP.
Nepal: Nepal has been increasing its education spending, aiming to improve access and
quality. In 2022, Nepal allocated around 3.6% of its GDP to education, according to data
from the UNESCO Institute for Statistics.
These figures provide a general overview of education spending as a percentage of GDP in these
countries. However, it's essential to consider other factors such as population size, economic
conditions, and the effectiveness of spending when comparing education systems across
countries. For the most up-to-date and detailed information, it's recommended to refer to official
government sources or international organizations' databases.
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4.4 Bangladesh education spending compare to previous budget:
Bangladesh education spending for 2022 was 11.92%, a 1.7% increase from 2021.
Bangladesh education spending for 2021 was 10.22%, a 0.17% decline from 2020.
Bangladesh education spending for 2020 was 10.39%, a 0.94% decline from 2019.
Bangladesh education spending for 2019 was 11.33%, a 0.63% decline from 2018.
Placing the budget in the Jatiya Sangsad yesterday, Finance Minister AHM Mustafa Kamal said:
"Enhancing the quality of education at all levels is our special commitment. We have been
reaping the benefits of the government's policies as well as targeted spending in education and
skill development over the past 14 years".
Pledging to continue the government's regular activities in the primary education sector, Kamal
said greater importance is being given to technology-based education to equip students to build a
‘Smart Bangladesh.'
Noting that a total of 59,000 laptops, multimedia projectors and sound systems have been
provided along with internet connectivity to more than 50,000 government primary schools
across the country to set up multimedia classrooms, he said 800 officers have been trained on
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ICT and more than 100,000 teachers have been given hands-on training to create digital
educational content.
Speaking about secondary and higher education, the minister said: "We are continuing our
efforts to transform educational institutions into modern and model institutions. A total of 351
secondary schools and 371 private colleges have been nationalized between 2009 and April
2023".
As many as 315 private secondary schools located in upazila headquarters, except government
schools, have been converted into model schools, he said, adding that the construction work of
180 buildings has been completed for government post-graduate colleges located at the district
headquarters.
"Of the 1,610 colleges selected under the private colleges' development project, the construction
of ICT-friendly buildings has been completed in 1,473 colleges," Kamal said.
Under the Secondary Education Sector Development Plan (SESDP), 33 model madrasas have
been set up along with 62 new schools in underprivileged areas, he said, adding that 176
academic buildings are being constructed along with 33 hostels under the Expansion of Science
Education in Government Colleges Project.
Mentioning that a total of 33,285 multimedia classrooms and 11,307 computer labs have been set
up in selected educational institutions since 2009 to enhance students' proficiency in information
technology and to modernize teaching methods, the minister said a further 64,925 multimedia
classrooms and 12,000 labs will be set up in future.
He also pointed out that digital textbooks are being developed for all levels of education, with
many of them already being available online.
A total of 710 ICT learning centres have been set up in selected educational institutions, he
added.
About technical and madrasah education, the minister said: "Our government considers the
'strength of youth' as the source of the 'prosperity of Bangladesh'. Therefore, we are
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implementing various activities to promote technical and vocational education to maximize this
strength".
"At the same time, we are modernizing madrasah education. Our efforts have enhanced the
interest of the people of the country in technical education. It is evident in the enrollment rate in
technical education in 2022, which is 17.2 percent compared to just 1 percent in 2010," he added.
The minister further said the government is working tirelessly to meet the Sustainable
Development Goal of increasing the enrolment rate in technical education to 30% by 2030.
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Tertiary Education:
Tertiary education in Bangladesh includes universities, colleges, and vocational institutions.
Universities offer undergraduate and postgraduate degrees in various fields, including arts,
science, engineering, medicine, agriculture, business, and social sciences. Notable universities in
Bangladesh include the University of Dhaka, Bangladesh University of Engineering and
Technology (BUET), and Bangladesh Agricultural University (BAU).
The outcomes of public education expenditure can vary significantly depending on various
factors such as the efficiency of spending, the quality of education provided, the effectiveness of
education policies, and the socioeconomic context of the country. Here are some potential
outcomes of public education expenditure:
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Enhanced Educational Quality: Adequate funding can improve the quality of education
by providing resources for hiring qualified teachers, improving infrastructure, updating
curriculum, and providing necessary teaching materials and equipment. Quality improvements
can lead to better learning outcomes and higher student achievement.
Increased Literacy and Numeracy Rates: Effective allocation of education funds can
contribute to higher literacy and numeracy rates among the population, leading to improved
overall human capital development and economic productivity.
Reduction in Dropout Rates: Public education expenditure targeted at interventions
such as school feeding programs, scholarships, and infrastructure development can help reduce
dropout rates, particularly among vulnerable groups, thus increasing the retention of students in
the education system.
Higher Levels of Educational Attainment: Increased investment in education can lead
to higher levels of educational attainment at all levels, including primary, secondary, and tertiary
education. This, in turn, can have positive long-term effects on individuals' earning potential and
socioeconomic mobility.
Skills Development for the Workforce: Public education expenditure can support the
development of skills that are relevant to the labor market, thus contributing to a more skilled
and adaptable workforce that is better equipped to meet the demands of a changing economy.
Social Cohesion and Equity: Equitable distribution of education resources through
public expenditure can promote social cohesion by providing equal opportunities for all
individuals, regardless of their socioeconomic background or geographic location.
Economic Growth and Development: Investments in education have been linked to
long-term economic growth and development, as a well-educated population is better equipped
to innovate, adapt to technological advancements, and participate effectively in the global
economy.
However, it's important to note that the outcomes of public education expenditure can be
influenced by various contextual factors, including governance, institutional capacity, political
stability, and cultural norms. Therefore, simply increasing spending does not guarantee positive
outcomes; it is equally important to ensure that funds are allocated efficiently and effectively to
achieve desired educational goals.
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7. Outcomes of Public Education Expenditure in Bangladesh:
Bangladesh has made impressive progress in expanding access to education, with
sustained increases in attendance rates at all levels of education. Between 2000 and 2016,
the net attendance rate at the primary and secondary education levels increased from 72% to
93%, and 50% to 72%, respectively. The expansion in tertiary access has been even more
rapid, from around 0% in 2000 to 16% in 2016. Overall, compared to the older generation, the
younger generations have had more opportunities for attending and completing school. As a
result, the education profile of the adult population has changed, with the percentage of adults
older than 18 years of age without schooling decreasing from 63% in 2000 to 44% in 2016.
The key remaining challenges in access are twofold: at the primary level, bringing the
remaining out of school children into regular schooling; and increasing overall access to
higher levels of education, especially at the tertiary level.
The progress in enhancing access to school education has been accompanied by an
increase in the internal efficiency of the system. Repetition rates and cycle drop-out rates
have decreased, and the survival rate and the coefficient of efficiency have increased at both
levels. However, high drop-out rates continue to be an issue of concern, especially at the
secondary level.
There has also been a reduction in the gender gap in access at the primary and
secondary levels, but the gap in tertiary level attendance has increased over time. While
near-gender parity in net attendance rate was achieved as early as 2000 at the primary level,
males significantly lagged behind females in secondary attendance rate at that time. Males
continued to lag behind females by 9 percentage points in 2016 as well, but this represented a
marked improvement from earlier. On the other hand, tertiary attendance rates are much
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higher for males compared to females, and this difference has increased over time. Hence, at
the primary and secondary levels, the focus now needs to be on increasing enrollment of
males, while at the tertiary level, greater emphasis is needed on understanding and addressing
constraints faced by women in accessing tertiary education. It should be noted, however, that
due to disadvantages faced by women of older generations in accessing education, the
percentages of adult women who have completed different levels of school education are still
lower than those for men.
Disparities in access across income groups and geographical regions have also declined
at the school level, further pointing to the broad-based nature of the expansion in access.
Attendance rates across different consumption quintiles have converged over the years,
especially at the primary level. For example, compared to a primary attendance rate gap of 26
percentage points between the richest and poorest quintiles in 2000, the corresponding
difference in 2016 was only 8 percentage points. The disparities in secondary school
attendance across quintiles have also declined, but remain much larger than in primary. There
has been a reduction in disparities across geographical regions, with attendance rates across
divisions converging over time. For instance, the attendance rate for the Sylhet division—
which had the lowest divisional attendance rate in 2000—has increased more rapidly that the
rates for other divisions (especially since 2010). Yet, there are visible gaps in school
attendance by poverty status and region. Furthermore, attendance rates across quintiles show
no signs of convergence at the tertiary. These findings indicate that more targeted support to
the poor, especially at the tertiary level, and to lagging regions, is needed to help them
overcome human capital disadvantages.
Along with the increase in the education budget, public spending per student has also
been increasing over time, but remains relatively low. In nominal terms, spending per
student as a percentage of GDP has increased for all levels of education though the increase is
limited to the primary and tertiary levels in real terms. Despite this increase, however,
spending per student remains low compared to the OECD average and figures for neighboring
countries. Hence, ensuring adequate financing remains an unfinished agenda in the
Bangladesh context, especially as the nation strives to become an upper-middle income
country.
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On the positive side, there is evidence that pubic spending at the primary level has
become more progressive over time. For example, in 2000, 59% of primary school age
children came from poor households, and they received only 56% of public primary education
expenditures; on the other hand, 30.7% of the primary age children were poor in 2016, and
they received 35% of the public expenditure. Analysis of household spending patterns shows
that public spending helps reduce the education spending gap between poor and rich
households. For example, in 2016 the richest quintile spent about 7.5 times more per student
on primary education, compared to the poorest quintile. Once public spending is considered,
that gap falls to 2 times. The pro-poor nature of public spending at the primary level has most
likely helped to increase the participation of children from the poorer segments of society.
Public spending at the secondary level is, however, pro-poor only among children who are
already attending secondary school.
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C. Instructional Materials: While there have been strides in providing instructional
materials such as textbooks and digital resources, accessibility and quality remain concerns,
especially in rural and underserved areas. Ensuring the availability of up-to-date and culturally
relevant materials, as well as investing in digital infrastructure for e-learning, could improve the
relevance and effectiveness of instructional materials.
D. School Infrastructure: Bangladesh faces challenges in school infrastructure, including
overcrowded classrooms, inadequate facilities, and a lack of basic amenities such as clean water
and sanitation. Investing in the construction and maintenance of school buildings, libraries,
laboratories, and sanitation facilities is crucial to creating a conducive learning environment and
improving educational outcomes.
Overall, while public expenditure supports essential educational inputs in Bangladesh, there is a
need for continued efforts to enhance their quality, relevance, and equitable distribution across
regions and communities. Strengthening monitoring and evaluation mechanisms can help
identify areas for improvement and ensure that resources are effectively utilized to promote
quality education for all.
Investment in education yields significant long-term economic and social returns in Bangladesh,
impacting various aspects of societal well-being. Here's an overview of its effects:
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B. Poverty Reduction: Education is a powerful tool for poverty reduction, as it provides
individuals with opportunities for better employment and higher incomes. Access to quality
education can break the cycle of poverty by empowering individuals to secure stable jobs,
access social services, and participate more fully in economic and social life. By investing in
education, Bangladesh can reduce poverty rates and promote inclusive growth.
C. Social Mobility: Education plays a crucial role in promoting social mobility by providing
individuals from disadvantaged backgrounds with the opportunity to improve their
socioeconomic status. Access to quality education enables individuals to acquire the skills
and qualifications necessary to pursue higher-paying jobs and access higher education
opportunities. By investing in education, Bangladesh can create a more equitable society
where individuals have the chance to fulfill their potential regardless of their background.
D. Overall Societal Well-being: Education contributes to overall societal well-being by
fostering social cohesion, civic engagement, and cultural enrichment. Educated individuals
are more likely to participate in democratic processes, advocate for social justice, and
contribute positively to their communities. Additionally, education improves health outcomes
by increasing awareness of preventive healthcare practices and promoting healthy behaviors.
By investing in education, Bangladesh can create a more prosperous, cohesive, and resilient
society.
In summary, investment in education has far-reaching economic and social benefits in
Bangladesh, including increased workforce productivity, poverty reduction, social mobility, and
overall societal well-being. By prioritizing education and ensuring equitable access to quality
educational opportunities, Bangladesh can unlock the full potential of its human capital and build
a brighter future for generations to come.
8. Conclusion:
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mechanisms, and stakeholder engagement to maximize the returns on investment. By fostering a
culture of continuous improvement, harnessing innovation, and promoting inclusive practices,
we can ensure that every money spent on education translates into tangible advancements in
learning outcomes, workforce readiness, and societal well-being. Together, let us reaffirm our
commitment to unlocking the transformative power of education, empowering individuals, and
building resilient communities for a brighter and more prosperous future.
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