RATIONAL CRITERIA FOR ALLOCATING FUNDS WITHIN THE EDUCATIONAL SECTOR IN THE ECONOMY
The purpose of this paper was to explore and formulate recommended criteria for allocating funds within the educational sector of the economy and the strategies for improving the allocation of funds to support greater product (students') performance. Allocation of funds within the educational sector of the economy is issues of paramount concern to all levels of educational system both at federal, state, and local government level. The high expectation of the society for educational products (students) and teachers to perform at higher levels, and for schools to guarantee the success of all students, the question of how best to support the expectation through effective and efficient allocation of funds becomes even more critical. Funds as a resource have remained a controversial issue at all levels of the educational sector in the economy. Okunamiri (2000) noted that educational finance critically examines all the costs and expenditure in the production of educational services which is both labour and capital intensive. Funds allocation is one of the most challenging tasks that our educational sector faces, whether they are in the early stages of reform or years into sustaining improvements. To sustain improvement, schools must devote sufficient funds to fully implement priority goals before moving on to others. Knowing how to allocate Funds effectively can lead to long-term accomplishment of goals rather than short-lived success. Facing the challenge of funds allocation begins with knowing the range of funds available. But knowing at one point in time is not enough; schools must periodically take stock of their funds. This means revisiting regularly whether funds are allocated in the most appropriate ways to achieve school's goals. Education has been in crisis for many years, much of the difficulty lies in the fact that the sector is poorly funded. This result in shortages of material and human resources experienced in the system: lack of qualified teachers; high turnover rate of teachers; shortage of classrooms, and a host of other problems. These difficulties have been most pronounced at both the primary and secondary schools levels. The system of education at all levels has undergone rapid changes and growth within a context of an unstable economy. The educational sector continued to expand even though there were substantial economic setbacks. The economic crisis has had a negative impact on the educational system and played a major role in the decline of the quality of education offered. The 1970s were the period of the oil boom in Nigeria. The economy expanded and with it came rapid growth and development of the education sector. By the 1980s, in contrast, major economic problems were encountered following the decline in revenue from petroleum products. The decline in the real gross domestic product in the 1980s and 1990s was estimated to be 6%. By 1994, the Central Bank of Nigeria reported that the money supply, particularly by way of deficit financing, had increased tremendously in a period of ten years. By 1995 the value of the Naira had fallen from a US$ ratio of 1:1 in 1985 to one of 85:1. For budget purposes the rate used at present is N100: US$1. The rate of inflation remained high and this had a negative impact on the education sector as well. Funding responsibilities during the crisis were transferred from one level of government to another, as well as to families, to help subsidize education through fee payments at secondary school and in higher education (Moja, 2000). According to CBN (2000), poor financial investment has been the bane of Nigerian education system to the extent to which the budgeting allocation has been very low compared to others. Furthermore, the federal government allocation to education has declined steadily since 1999 and is much lower than the average...
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