With private school enrollments increasing over the years, government schools are in effect in competition with private schools for students. But there is another kind of competition in play in the education sector - the competition between the local governments, the state government and the central government.
In a landmark book, named Competitive Governments, Albert Breton turned the concept of decentralization on its head.
The classical idea of decentralization is that different levels of government ought to be given clear and exclusive responsibilities. It is hypothesized that this will drive people to hold each level of government accountable for what they ought to do and consequently, service delivery will improve.
Breton, came up with an alternative hypothesis. He proposed that governments could be competitive in their relations with each other and in their relations with other institutions in society, such as private providers of services, in supplying consuming households with goods and services. He contended that such competition between government levels and private service providers would enable households to make efficient choices as they would individually make the links between the services that they pick from each provider, based upon the tax prices that they pay for these goods and services.
This is a really chastening thought for pro-decentralisers like me!
Let me illustrate whether the thoughts of Albert Breton and Jack Weldon are relevant in the real world. One does not need to go far to seek out examples. In India now, we have a significant number of people who have obtained the ‘Aadhaar’, which is a unique identification number. Earlier, identification was a local activity. If an individual moved from one place to another, she needed to cancel her ration card in one location and obtain a new ration card in another. This was terribly inconvenient and corruption prone. Now, the Aadhaar number is universally accepted all over India. Seen in the light of theory, the Aadhar number is thus a mechanism by which the central government has managed the ‘externality’ of identification. However, this leads to some interesting spinoffs. With a relatively more reliable identification process in its hand, it is possible for the central government to centralize the delivery of pro-poor services through a direct cash transfer. For instance, using the Aadhaar number, the centre could send pensions directly to all senior citizens, with little work for the State or the local government to do, because the externality of identification has been managed at the top through the UID.
So how would this apply in the education sector? Govt funded schools in India have been run by different levels of government including panchayats, zilla parishads, municipal corporations, state governments and the central government (Kendriya Vidyalayas, Navodaya Vidyalayas, Sainik Schools etc..). The state governments also have indirect control over all government-aided schools under private management. I don't know if anyone has studied how competition between these various levels of governments in running schools has been playing out, right from the pre-independence era.
One example is the Kendriya Vidyalayas (KVs). In the early 1960s, the Central Government set up the KVs to address the problems faced by the children of transferable central government employees who have to move across the country. Transferring from one state board curriculum to another, at possibly different levels and, with a different set of languages would have been a nightmare for children of such employees. The KVs are present across all states and provide uniformity in the curriculum as well as continutity in the school year across all schools. They are entirely under the purview of the Kendriya Vidyalaya Sanghatan, a central government body, and the state governments have no say in how they are funded or run.
Although admissions to KVs are restricted to children of Central Government employees, what if the central government could set up many more KVs or other such schools across the country (there are around 980 now) and also open up admissions to any child. I wonder if there are any restrictions on the Kendriya Vidyalayas or the Central Government from doing something like this. For instance, Tamil Nadu has not permitted the Central Government to run a Navodaya Vidyalaya in the state.
Currently, control of schools is pretty much concentrated with the state governments. They call the shots for all schools run by lower levels of government. The central government provides some funding to the states, but doesn't have a say in the administration of schools. If, and when, the state governments decide to actively devolve power and control of schools, including financial and administrative autonomy for running schools to the lower levels of governments, some interesting possibilities may emerge. These schools are likely to be more responsive to parents and children and more accountable for learning outcomes. The idea of devolution has been discussed for a long time now, but the political class, the bureaucracy and the teacher community seem to have little incentive to do so. It will probably happen only after sustained bottom-up political pressure is mobilised by the parents at the grassroots level.
Another type of competition between governments that is playing out is at the level of accrediting bodies, the school boards. An ongoing case in the Supreme Court (Special Leave Petition (Civil) 16 of 2013 - Asso. of Management of Pvt. Schools(CBSE) .Vs. State of Tamil Nad & Ors.) highlights this.
The Tamil Nadu Legislature passed the Tamil Nadu Private Schools (Regulation of Collection of Fee) Act, 2009 that allows the Government to determine and specify a ceiling for fees for each school. Private schools in Tamil Nadu affiliated to the CBSE and ICSE went to the Madras High Court arguing that by dint of their affilation to the CBSE/ICSE, they could not be regulated by the State Government. The CBSE's counsel also made the same point in the case arguing that the State Government will not be entitled to regulate the fees by enforcing a rigid fee structure on CBSE schools. But the Madras High Court ruled (Writ Petition 28305 of 2010) in favour of the Government of Tamil Nadu in September 2012.
The case is now in the Supreme Court and it's decision on this is due early next month.