Investing in education towards Malawi 2063

By Dr. Limbani Eliya Nsapato, Country Director, Edukans Foundation

Furthermore, the country faces acute skills shortage and personnel gaps in the public service. For instance, in education there is a staffing gap of at least 47%, while in health, Malawi fails to meet the minimum threshold of 23 doctors, nurses, and midwives per 10,000 population which is necessary to deliver essential maternal and child health services. In the agriculture sector a recent study commissioned in 2017 by Norwegian Church Aid established that “young and women farmers in the nine districts of Malawi have some skills in production but Survey results showed that 85% of the respondents do not have skills in marketing; labelling, grading, packaging and promotion of products. The skills gap contributes to high unemployment in the country, which is among the highest in the SADC region. There is a 23% unemployment rate of youth between the ages of 15 and 34. Moreover, only 10% of the total labour force is employed in the formal economy.

Consequently, Malawi has poor ranking on the global scene in terms of human development and achievement of sustainable development goals. Malawi’s literacy rate of 68.6% is the fourth lowest in the SADC region, after Comoros (59%), Mozambique (61%) and Angola (66%). The 2018 United Nations Human Development Index (HDI) ranked Malawi HDI value for 2017 as no 171 out of 189 countries. With an HDI value of 0.477— the country is classified at level of low human development category. On the path to 2030 SDG Malawi ranked number 146 of 162 countries on the 2019 Global SDG Ranking.

Government underinvestment in education

Education is important as an investment because of high private and social returns on investment which range from 10% to 25%. In Malawi, one additional year of schooling increases lifetime earnings by 10% on average, by 9.7% among male workers and 11.4% among female workers. These positive figures justify the need for increased public investment at all levels especially at primary and secondary school levels. However, the high levels of illiteracy and skills gaps in Malawi are largely due to underinvestment in the education sector in Malawi. Since independence the government budget has increased exponentially, resulting in increased enrolment at all levels of education, but investments have fallen below international benchmarks. For instance, in 1964 the budget allocation to education was K5 million; but this increased to K4 billion in 2000 and further to K350 billion in 2020. In 2021/22 education sector has been allocated K327.3 billion out of K1.999 trillion national budget.

From 1964 to 2020 school enrolments have increased from 360,000 to 5.4 million at primary level; from 6,000 to 415,000 at secondary level; and from 180 to 47,000 at university level. This is good progress. However, we still have millions of illiterate adults, children and youth as transition from lower levels to higher levels of education are below 40%.

Although education is allocated the lion’s share of the budget, its share falls below international benchmarks of 6% of the GDP and 20% of the national budget. Over the period from 2000 to 2021 education share averaged 16.4% of the national budget and 5.7% of the GDP. The maximum share of the national budget was in 2002 when it reached 23%, while the minimum was 11% in 2007. On the other hand, the maximum share of GDP was in 8.7% in 2010, while the minimum is in this year’s budget at 3.2% in which education share over the national budget is estimated at 16.5%.

Government underinvestment in education has led to under-allocations at all levels of education particularly in early childhood development, youth and adult literacy, and vocational education and skills development activities, which collectively report huge budget deficits and over-dependence on donors for aid specially to finance development projects. Over 70% of funds allocated to education go towards personal emoluments (salaries) leaving very little (below 30%) for development projects such as construction of schools, purchase of teaching and learning materials, and training and recruitment of teachers. Underinvestment has also led to households paying exorbitant school fees and many leaners dropping out of school due to lack of financial and material support.

On the road to 2063 education sector has developed a ten-year strategy called National Education Sector

Investment Plan (NESIP) 2020-2030 with an estimated budget of -K9.9 trillion (US$12.4) billion. Financing is expected to come from government to the tune of US$5.6 billion and donors who are expected to contribute about US$417 million. This leaves a huge funding deficit of US$6.3 billion. In the first year of NESIP implementation, government expenditure is expected to amount to K327.3 billion based on the 2021/22 budget projections, against a NESIP projected budget of K646.9 billion, leaving a deficit of K319.6 billion or 49.4% of the total cost for 2021/22.

Looking Ahead

For education to be a catalyst for MW 2063, government needs to invest more in education and reduce budget deficits and sub-sector under-allocations. This requires growing the economy as a whole and prioritizing spending in education through adequate resource allocations.

Malawi’s GDP as of 2021 is estimated at K7. 5 trillion. Over the past five years Malawi’s economy has grown below the recommended rate of at least 6%. In 2020 the economic growth was estimated at 0.9% which was the lowest since the 2001 recession. To grow the economy at an ideal rate, government needs to identify innovative ways of expanding and diversifying the economy in order to grow the national cake. This includes strengthening the revenue collection capacity, investing more in mining and tourism sectors, introducing new and progressive taxation measures, and strengthening public finance management systems including fighting illicit financial flows and corruption.

As the economy grows, government should make substantial increase in financing education. Apart from providing a lions’ share of the national cake to education, the share should be at least 6% of the GDP and at least 20% of the national budget in order to address the needs. Furthermore, substantial allocations should be developed to underfunded sub-sectors such as ECD, literacy, skills development and address challenges of equity, inclusion and quality. Finally, there should be good governance and management in the sector including addressing challenges of coordination, performance and public finance management.

Conclusion

Unless deliberate and concerted efforts are made to address the challenges that block adequate investment in education as human capital, then MW 2063 will remain a pipe dream. There is, therefore, need for sensitisation of key stakeholders in the education sector to increase awareness on the need to increase investment in education and address existing challenges

by Moses Chirambo JR