CSR spend on education increases, but is it helping to improve literacy rate?

New Delhi, 12 September, 2020: Education is an area that gets the maximum allocation from the corporate under their Corporate Social Responsibility (CSR) activities in India, however, there is a mismatch between the need and spend among the states. Thus it becomes important to understand the status of education for those planning their CSR activities.

A recent report by National Sample Survey Organisation (NSSO) throws light on the literacy rate in the country. Among the states, Kerala topped the list with 96.2% literacy while Andhra Pradesh emerged as the worst performer with a literacy rate of 66.4%. Below is a table showing the five worst performer states in terms of literacy and top five states getting the maximum amount from the CSR kitty.

Worst performers in literacy rate and the top CSR beneficiaries

Sources: NSSO and Ministry of Corporate Affairs

In its 75th round, the union government’s statistical arm conducted a survey on Household Social Consumption: Education from July 1, 2017 to June 30, 2018. It tried to collect indicators on participation of the persons between the age group of 3 to 35 years in the education system, expenditure incurred on education of the household members and various indicators of those currently not getting education. Besides, for persons of age 5 years and above, information was collected on ability to operate computers, ability to use the internet and use of the internet during the last 30 days.

The report gives a complete picture of what is happening in the education sector in India and can give an insight to CSR players who want to make an impactful intervention.

It should be noted that education tops the list of focus areas of CSR activities in India followed by health and Rural Development.  In 2018-19, the amount spent on education was Rs 7,499.26 crore as compared to Rs 4,958.48 crore on health and Rs 2,308.83 crore on rural development. The education sector received more than 40 % of the total CSR budget in 2018-19.

This is not a story of just one year, the education sector clubbed with differently-abled and livelihood has seen the sharpest rise in allocation of CSR funds over the years. As per the Ministry of corporate affairs (MCA), the sector received Rs 3,188.09 crore in 2014-15, which increased to Rs 7,499.26 crore in 2018-19.

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This is significant amount if compared to total allocation of government of India on school education. In 2018-19, when corporate spent Rs 7,499.26 on education in India under their CSR activities, GOI allocated Rs 48,441 crore on School Education and Literacy. So, the CSR budget for education was more than 15 per cent of total budget of GOI on school education.

Credit should be given to corporate for prioritizing education and spending significant amount on it. At the same time, it should be highlighted that the states getting the maximum benefit of the CSR budget in India, are not the ones with the worst literacy rate (See table).  Those lagging behind in the literacy ranking are nowhere in the focus of corporate. This shows there is something amiss in the CSR planning. The present scenario demands not just attention but a strategic intervention in the sector by CSR players.

Even the Government of India has recognised the role of Philanthropy in its Education Policy 2020 by saying that there is need of substantial investment in a strong, vibrant public education system as well as the encouragement and facilitation of true philanthropic private and community participation. So, this is the time for CSR players as well to recognise their own importance in improving literacy rate of country as well.