Cost of Compliance to the RTE
Overview
The Right of Children to Free and Compulsory Education Act (2009) (RTE) of India
mandates free and compulsory education for all children. The financial and legal implications
of enforcing recognition norms on schools as outlined under Section 18 and 19 of the Act
will either make private schools inaccessible to the current socioeconomic demographic they
serve, or lead to their closure if they fail to meet these standards. The self-contradictory
nature of this clause goes against the essence of the act and necessitates the rethinking of
school norms from an outcomes rather than inputs based perspective. In this paper we studied
budget private schools in Delhi and estimated the costs for these schools to meet RTE
standards. We find that an average four-fold fee hike will have to be imposed on the students
if these schools are forced to comply with the RTE recognition norms.
1
The Space of School Education in India
Aspiring towards the goal of Universal Primary Education, India launched the Education for
All initiative (Sarva Shiksha Abhiyan (SSA)) in 2001, culminating in the adoption of the
Right of Children to Free and Compulsory Education Act (RTE Act) (2009). The Act ratifies
education as a fundamental right and seeks to promote equitable access to education for all
children up to the age of 14 years.
In recent years, India has seen a decline in public expenditure on education and a concurrent
increase in the number of private schools. The Indian Education system consists of
government or public schools, government funded or aided schools, and unaided or private
schools. Private unaided schools (or simply private schools) consist of both, those recognized
by the government as well as those that are not recognized. Delhi, for example, has 2874
government schools, 2353 private recognized schools and 1594 unrecognized private schools
according to official estimates (Chandra, Joshi, & Gaur, 2012; Lok Sabha, 2012).
Interestingly, as the total public expenditure per student in primary education as a percentage
of GDP per capita declined from 11.5% in 2003 to 9.0% in 2006 (World Bank, 2012), the
share of private school enrollment increased from 19% to 28% between 2006 and 2011
(ASER, 2012).
Education in India significantly lacks quality, despite the progress made in terms of student
access, pupil teacher ratios and infrastructure. While the Net (primary) Enrolment Rate
(NER) from 70% to 90% over the past decade, learning outcomes have dropped, as
demonstrated by results of national and international surveys (World Bank, 2012). At the
elementary level, only 40% of the children in grades 4 and 5 could perform subtraction and
over 53% students in grade 5 could not read a grade 2 level text (ASER, 2012). Moreover,
India ranked 73rd amongst 74 countries that participated in the PISA assessment (Programme
for International Student Assessment). While the RTE outlines minimum standards for
schools to operate, these norms are almost entirely focussed on inputs and not on outcomes.
Sections 18 and 19 of the RTE Act stipulate that ‘no school [is] to be established without
obtaining [a] certificate of recognition [from the designated authority]’, and defines the
standards for school area, classroom size, number of toilets, pupil teacher ratio, teacher
salaries, teacher qualifications and number of library books that must be met by every
established school. While it is important to maintain basic standards, some requirements of
the Act are so stringent that it is impossible for some of the private schools, particularly the
low budget schools, to meet them under the current circumstances, and many of them will be
forced to close. In this study we measure the financial impact of enforcing school recognition
norms on low budget unrecognized schools in Delhi and find that an average four-fold fee
hike will have to be imposed on the students if these schools are forced to comply with the
RTE recognition criteria.
School Characteristics
The schools selected for this study are low-cost budget private schools charging an average
monthly fee of INR 322 per student. Table 1 lists the recognition criteria for schools in Delhi.
As seen in Figure 1, only over half the schools meet the land specifications. Only one school
had separate toilets for boys and girls, the remainder schools are yet to construct these. Six
schools meet the average classroom size requirement, and interestingly, not a single school
meets the requirement of teacher salary specifications, with an average teacher salary of INR
2382, which is almost one tenth the pay mandated by the 6th Pay Commission. Ten schools
meet the pupil teacher ratio (PTR) of 30:1 and all schools successfully comply with the
requirement for municipal water supply.
2
Cost of Compliance to the RTE
Table 1: School recognition norms for Delhi as outlined by the RTE Act (2009).
No. Article
1
School area1
2
Classroom area per
student2
3
Pupil Teacher Ratio3
4
Teacher Qualification6
5
6
7
Teacher Salary4
Library books2
Toilets5
Requirement
200 sq. Mt
10 sq. feet per student
30:1
Senior secondary plus 2-year Diploma
in Ed.
Equal to government counterparts
10 books per student
Separate for boys and girls, 1 per 30
students
Must have certificate from MCD or DJB
Alternative arrangements may be made
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Drinking water3
9
Playground7
1 – Master Plan Delhi (2021)
2 – Delhi Government School Recognition/Upgrade Guidelines
3 – Delhi State RTE rules: Delhi RTE Rules (2011)
4 – Delhi State Education Act and Rules (1973)
5 – Based on Norms and Options Technical Note Series on School and Anganwadi Toilet
Designs
6 – National Council for Teacher Education notification 215, 23 Aug 2012
7 – An MHRD notification (No. DE.23 (15)(196654)/RTE/MHRD/2012/347-364) removed
the requirement for a playground in 2012
Figure 1: Bar graph showing the number of schools complying with each of the school
recognition norms outlined by the RTE Act (n=15).
3
Financial Implications of Recognition Norms1
Infrastructure
In 2013, the state government of Delhi significantly reduced the requirement for land for
private schools, lowering it from 800 sq. metres to 200 sq. metres for one year, giving
schools time to meet these requirements. In this section we have calculated the financial
implications based on this new standard. Even with a land requirement of 200 sq. metres,
only eight schools were able to meet these norms. The mean area of the schools is 324 sq.
metres (3487.51 sq.feet) and the average cost for acquiring this land using estimates from
government-specified circle rates is approximately INR 2.2 m. The Delhi RTE rules also
mandate a minimum 10 sq. feet per student in terms of classroom space. In the schools
surveyed, only six schools met the specified norms, thereby requiring the schools to
undertake significant remodelling in order to meet the norms. The average combined costs
for resizing and/or constructing new classrooms was calculated to be INR 1.2 m according to
government-recommended construction rates. While 200 sq. metres might be a reasonable
minimum requirement for any school, in terms of school size and classroom number and size,
it is close to impossible to increase the size of the school in for a densely populated urban
area such as Delhi.
Delhi school Recognition/Upgrade Guidelines require that all schools must provide drinking
water and sanitation facilities on location (certificate from Delhi Jal Board (DJB)/MCD
required). In the sample studied, all schools had drinking water facilities from either the
MCD or DJB. When we estimated the number of toilets required based on a student: toilet
ratio of 30:1, only one school met the criteria and 14 out of 15 schools needed to construct
new or restore existing toilets giving an estimated mean cost of construction INR 93,000 at
government-recommended rates.
The School Recognition/Upgrade Guidelines of the Delhi Government as well as the DSEAR
(1973) stipulate that each school must have a library (the size of library is not outlined in any
of the rules) and the guidelines specify that the school must hold at least 10 books per
student. Of the schools in our sample, six schools had no library and the average requirement
for books was 1812 per school. Based on discounted rates (for example those sold by
education sector non-profits) (INR 30 per book), on average, INR 54,300 would be required
by the schools to meet these needs. This is a significant expenditure for budget schools such
as the ones under study. Though some research has shown that the provision of libraries did
not necessarily improve learning outcomes (Borkum, He, & Linden, 2012), the importance of
books and reading skills cannot be trivialized. It might therefore be worthwhile considering
the option of mobile or shared libraries for budget schools or even options of sharing libraries
with government schools which have resources that are significantly underutilized.
Teachers’ Salary, Qualification and Pupil Teacher Ratio
The Delhi RTE Rules specify a Pupil Teacher Ratio (PTR) of 30:1. In the schools surveyed
in this study, the mean number of students per teacher was 29.6. However, there is significant
variation in these numbers (SD = 15.8) and while 26% of the schools will have to hire more
1 Details of School Recognition Norms: The norms for recognition of schools in the state of Delhi are collated from multiple sources.
The RTE Act and the Delhi RTE Rules (2011) specify the pupil teacher ratio and classroom size as well as the source of drinking water;
the Delhi School Education Act and Rules of 1973 (DSEAR) as well as the Delhi RTE Rules specify that the teacher qualification and salaries
must be commensurate with government school teacher salaries; and the Recognition/Upgrade Guidelines of the Delhi
Government specify the number of library books per student. Interestingly, the Delhi Master Plan (2021) outlines school area at 800 sq.
metres (8611 sq.feet). This was modified to 200 sq. metres in 2013. While the DSEAR (1973) or the RTE do not specify the exact land
requirement, the understanding by the Municipal Corporation of Delhi (MCD) is that recognition cannot be granted unless these land
norms are met.
4
Cost of Compliance to the RTE
teachers to meet this requirement, some also report excess staff. PTR is one of the most
resource intensive school inputs. Halving class size would mean doubling the number of
teachers in a system and will have a significant impact on education budgets.
The norms also specify that the teacher qualification and salaries must be commensurate with
government school teacher salaries. Of the 15 schools studied, 11 had teachers who were
graduates or post-graduates, 2 schools had a mix of college and high school graduates and 2
schools had just high school graduates. If the state-defined norms are to be followed, some of
the existing teachers in these schools will have to be replaced with those holding minimum
required qualifications and at the mandated pay scales. However, this will not have a direct
cost implication as the salary standards will cover the outlays for hiring qualified staff.
Interestingly, with an average teacher salary of INR 2,355 per month, not a single school
meets the teacher salary norms specified by the 6th Pay Commission (2006) (INR 23,220 per
month). To do so would mean an average increase in monthly expenditure on teacher salaries
from INR 25,907 to INR 246,132 per school keeping the current number of teachers. Recent
research shows that teacher characteristics and qualifications are poor predictors of better
student outcomes (Kapur, 2013; Rivkin, Hanushek, & Kain, 2005), yet teacher salaries are
the largest component of education budgets. Allowing for flexibility in salary standards and
designing creative incentives such as performance pay might be more effective in improving
learning outcomes (Muralidharan & Sundararaman, 2009).
Increase in Monthly Expenditure
Based on the estimated costs of infrastructure and recurring outflow, we calculated the
average expected increase in expenditure per school. The total average cost per school for
land acquisition, construction of toilets, procuring library books and classroom expansion
was estimated at INR 2.4 m based on the conservative estimates and classified as capital
expenditure. Equated Monthly Instalments (EMI) calculated at an interest rate of 18% (using
a projected average for 30 years) gives a mean payment of INR 35,521 per month over a 30year repayment period per school. Adding to this the average cost of teacher salaries at INR
246,132 per school per month and overheads calculated from the current per student fee
(overhead = average fees – teacher salary), we find that the average cost per child (including
existing overheads from current fees) will go up to INR 1174 per month from the current fee
of INR 322 per month. This implies an increase in per student fee of nearly four times.
If the government were to revert to the older land norms of 800 sq. metres per school, the
total average cost per school for land acquisition, construction of toilets, procuring library
books and classroom expansion would increase to INR 18.2 m, with an estimated EMI of
INR 274,624 and the per student expenditure would go up to INR 2139 – which is more than
a six fold increase in fee.
These costs will be prohibitive for the current students who can barely afford these schools
(most schools report an average default rate of 30% (CCS unpublished Data)). Moreover, it
could lead to the closure of many of these schools if they fail to meet the norms, rendering a
large number of students out of school.
Discussion
The current standards set by the Delhi State government for recognition of schools focus
largely on inputs related to infrastructure, PTR, teacher pay and teacher qualifications, which
can be easily measured and monitored, thereby making the implementation process
straightforward and the results visible. The enforcement of these standards, however, is likely
to have adverse effects on the education system due to reasons that are three fold:
5
First, the forced closure of non-compliant private schools will leave a large number of
students out of school. Despite the reduction in requirement of land size from 800 sq. metres
to 200 sq. metres, nearly 30% of the unrecognized schools in Delhi will not be able to meet
recognition criteria (Chandra et al., 2012) and will have to cease operations with effect from
2013. By a conservative estimate, this will leave close to 100,000 students out of school2.
Second, the projected four-fold increase in per student expenditure will place the budget
private schools out of reach for most of the students. These schools operate on extremely low
budgets and currently report a fee default rate of at least 30% because they cater to a large
section of the population from disadvantaged sections of society (CCS unpublished data).
Increase in fees by 400% will make these schools completely inaccessible to the current
target population.
Lastly, the government schools do not have the capacity to accept the students who will
potentially be out of school. Despite the RTE guidelines, 46% government schools in India
are unable to meet PTR requirements and 47% reported a classroom shortfall in 2012
(Dongre & Kapur, 2012). Moreover, the Delhi government has reported a deficit in the
number of schools and acknowledged a projected increase in enrollment by at least 100,000
per year (Lok Sabha, 2012).
The development of human capital, enhancement of economic productivity and increase in
earning levels depends not only on the inputs to education, but also on the quality of
instruction (Hanushek & Woessmann, 2007; Hanushek & Zhang, 2006). Over the last five
years, India has seen an overall drop in learning achievement. The decline in learning
achievement for government schools has been steeper than for private schools, with private
schools outperforming government schools. Private schools in India are not only more
effective in imparting cognitive skills to children, but also do so at a fraction of the cost
(Kingdon, 2007; Muralidharan & Kremer, 2006)(ASER, 2012; French & Kingdon, 2007).
The expected closure of private schools is compounded with the fact that this will only affect
the already underserved. The enforcement of norms under Sections 18 and 17 of the RTE,
therefore goes against the essence of the Act, and necessitates the rethinking of the actual
cost of compliance.
Sample Description
Fifteen unrecognized private schools with wiling participation were selected in three areas of
Delhi/NCR, five each in rural, semi-urban and urban areas. While this selection methodology
rendered the sample biased in favour of schools that had marginally better infrastructure and
characteristics, the bias only underestimates the average increase in cost. A sample size of 15
could limit external validity, but the results of this study do allow for generalization to a
larger population because an independent survey conducted by the Municipal Corporation of
Delhi (MCD) of the 1594 unrecognized schools in Delhi found that almost 30% would be
non-compliant if the current norms were to be enforced, thereby allowing us to extrapolate
our findings to schools in Delhi.
2 A survey conducted by the MCD found 1594 unrecognized schools in Delhi. Assuming an average of at least 200 students per school (a
conservative estimate), and approximately 30% schools unable to meet land norms, we estimate that at least 100,000 students will be
displaced.
6
Cost of Compliance to the RTE
To estimate the increase in costs for schools, norms for school recognition were used to
calculate the differences in existing and required inputs. Existing infrastructure of the sample
schools, such as land area, classroom size and number of toilets, were measured physically.
Inputs such as current number of library books, pupil-teacher ratio (PTR), teacher salaries
and teacher qualifications were queried from schools and recorded. The costs for satisfying
these recognition criteria were then determined based on inputs required to meet the specified
criteria. Construction costs were queried from local contractors and land cost was based on
government-specified circle rates (INR 19,361 per sq. metre for rural and INR 47,140 per sq.
metre for semi urban and urban areas). We have analyzed the financial implications using
only the above conservative estimates.
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