The Effective Utilization of the Capitation Grant; Essay

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It is a well-known fact that education is the most important key for any nation to achieve the needed development. Education is simply the soul of a society as it passes from one generation to another. (Chesterton, 1874). However it is established that about two-third of the world’s population live in stark illiteracy and the majority of them come from the third world. (Education for All, 2000). Ghana as a nation is not an exception of high illiteracy rate in the sub-region. Not only is the high illiteracy rate the problem but most importantly the regional disparities in the provision of educational services. It took over fifty years for education to be extended from the south to the northern part of Ghana. (Vincent, 2000).

Various governments from independence have made efforts to promote and improve the quality of education in Ghana. The Convention People’s Party led by the first president of the republic of Ghana Dr. Kwame Nkrumah enacted the education act in 1961 and this act formally introduced the Free Compulsory and Universal Basic Education (FCUBE) in Ghana (Bening, 1990). This act was to compel all parents to send all children of school going age to school. However, this and many policies that were formulated by the Nkrumah’s government could not see the light after his overthrow in 1966. (Vincent, 2000).

One of the main reasons that children in Ghana do not attend school is that their parents simply cannot afford to pay the levies charged by the schools. Despite the policy of fee-free tuition in the basic schools, many districts charge levies as a means of raising funds, for example, for school repairs, and cultural and sporting activities; this has the effects of deterring many families, particularly the poorest, from sending their children to school. (GES, 2006)

The government of Ghana through the Ministry of Education, Youth and Sports has therefore set up a Capitation Grant Scheme, which commenced in the 2003/2004 academic year, whereby every basic school receives an amount of GH¢ 2.50 per male pupil enrolled and GH¢ 3.50 per female pupil enrolled. This should serve to remove the financial barrier created by these levies, yet more than compensate the schools for any lost of revenue they face as a result. (Ibid)

The utilization of the Capitation Grant has been designed to empower the school to effectively use financial resources to plan and carry out quality improvement activities. The process of planning activities should be participatory and transparent. The grant is therefore expected to serve as an opportunity to help build school level capacity to effectively implement fiscal decentralization – which is a long term goal of the government of Ghana. (GES, 2006)

1.2 Problem Statement. It is estimated that about 70 percent of Ghanaians live in rural areas of Ghana and are very poor. A larger proportion of the rural population is self employed and operates largely in the informal sector. Incomes of people in this category are unstable, irregular and often low (GPRS, 2004). This situation invariably has an adverse effect on the lives of the people of Ghana, culminating in the inability of parents to send their wards to school. This also affects the physical and mental development of children due to malnutrition, hunger and disease. Any nation that is bedevilled with these calamities must adopt measures to arrest the situation or remain dependent on other developed economies for survival.

Education is therefore the bedrock for the development of the human resource of any nation to compliment the physical power of its labour force. The use of the physical power by the labour force without complimenting it with the intellectual capabilities in a germane psychological environment will certainly lock out societal development in a primitive state. That is why the human resource development efforts cannot be over emphasized.

The government of Ghana implemented policies to help develop her human resource base at the expense of the tax payer. The Capitation Grant Scheme is a policy implemented to provide for the Ghanaian children of school going age the cost of basic education free of charge. This is to make basic education more accessible and attractive to everybody in the country. However, for the programme to realise its intended impact, it must be sustainable. Not only are the implementing and allocation of resources very crucial here but its sustainability depends largely on its effective utilisation. The research therefore seeks to find out the effects of the Capitation Grant on enrolment which appears a controversial issue between some politicians and some civil society groups. The Committee for Joint Action (CJA) for instance severally made counter pronouncements to claims by some politicians that the Capitation Grant policy has led to over sixty percent increase in enrolment at basic schools. This study therefore seeks to assess how effective the Capitation Grant is put to use, the effects of the Grant on enrolment level and infrastructure development of basic schools in Savelugu.

1.3 Research Questions 1. How effective is the Capitation Grant being utilised by schools in Savelugu? 2. Do schools still demand payments from parents? 3. What has been the effect of the Capitation Grant on enrolment levels of beneficiary schools in Savelugu? 4. What is the effect of the Capitation Grant policy on infrastructure development of basic schools in Savelugu.

1.4 Objectives of the Study 1.4.1 General Objective To assess the use of the Capitation Grant and its effects on enrolment and infrastructure development of schools in Savelugu.

1.4.2 Specific Objectives 1. To asses how effective the Capitation Grant is been utilised by schools in Savelugu. 2. To determine whether schools still demand other payment from parents 3. To ascertain the effect of the Capitation Grant on enrolment levels of beneficiary schools in Savelugu. 4. To establish the effects of the Capitation Grant policy on infrastructure development of basic schools in Savelugu

1.5 Justification and Relevance of the Study. A research of this type will provide the appropriate facts and figures on the dynamics in the disbursement of the Capitation Grant by schools in Savelugu.

In addition, it will provide policy makers with the challenges and successes of the Capitation Grant Scheme.

The study will serve as a source of knowledge for academic purposes and base line information for further and future studies.

1.6 Scope of the Study. The parameters within which the study was conducted are as follows: Area of the study: the study area covers Savelugu in the Savelugu Nanton District with specific attention on basic schools in Savelugu. Content of the study: this is basically to assess the use of the Capitation Grant and its effects on enrolment and infrastructure development of basic schools in Savelugu.

Time of the study: the study period stretches from September 2007 to June 2008.

1.7 Methodology of the Study. In order to realise the objectives of the study, appropriate methods of data collection, sampling techniques as well as data analysis and presentation were considered.

1.7.1 Sampling Techniques In many cases sampling is the only way to determine something about the population. Some of the major reasons why sampling is necessary are: the destructive nature of certain test, the physical impossibility of checking all items in the population, the cost of studying all items in the population is often prohibitive; the adequacy of sampling results and to contact the whole population would often be time consuming. Appropriate sampling techniques were therefore used to select our respondents for the study.

The Simple Random Sampling Technique: this technique was used to select parents/guardians from all the ten basic schools interviewed. This gave all parents/guardians the equal chance of being selected. All parents/guardians were identified through the registers of schools in the study area, listed and wrapped in pieces of papers in a basket. These were mixed-up and sample units were picked one after the other till we reached the sample size of fifty parents/guardians. This was to ensure that the element of bias was eliminated in the selection of respondents.

Purposive sampling technique was used by the team to select head teachers and the administrators of the Capitation Grant as part of our respondents. This technique was meant to help us get directly to persons with the required information on the disbursement and monitoring mechanisms involved in the Capitation Grant policy. This enabled us gather in-depth information from the selected key informants on the disbursement process of the Capitation Grant and the monitoring mechanisms put in place to prevent the abuse of the grant.

1.7.2 Methods of Data Collection Interview: this is a commonly used method of collecting information. Any person-to-person interaction between two or more individuals with a specific purpose in mind is called an interview. Both structured and unstructured interview were used to collect information from respondents in the study.

In a structured interview, the team asks a pre-determined set of questions using the same wording and order of question as specified in the interview schedule which could either be close or open ended. This method was used because not all the study population can read and write; for instance pupil at the lower level and some SMCs and parents.

Questionnaire was also employed to acquire information from the respondents. A questionnaire is a written list of questions, the answers to which are recorded by respondents. Questionnaire were designed and administered to head teachers all schools because respondents are literate.

1.7.3 Sources of Data Primary data: the team sourced ‘first hand’ information from key informants and sampled respondents through interviews and the use of questionnaires.

Secondary data: the research group also depended on secondary data for information. That is any ‘second hand’ information acquired from previous data. Secondary data collected included information on enrolment figures, the profile of the study area and literature review.

1.7.4 Data Analysis and Presentation Data analysis is simply the process of making meaning out of the raw data collected. Data was analysed with the support of computer software programme thus Statistical Package for Social Scientist (SPSS).

Manually, data was edited to identify and minimise as far as possible, errors, incompleteness, misclassification and gaps in the information obtained from the respondents. Having cleaned the data, the next step was to code it considering the way a variable has been measured in our research instrument and the way we wanted to communicate our findings across. The coded data were then fed into the Statistical Package for Social Scientist (SPSS) software programme in the computer to give us the quantitative analysis of the information. The data was presented in the form of tables, charts and diagrams.

1.8 Chapter Organisation The research is organized into five chapters with the first chapter consisting of the background, problem statement, research questions, objectives, justification, scope, methodology and organization of the report. Chapter two follows with the profile of the study area. Literature review on the subject area follows the second chapter as chapter three. Date is analysed and presented in chapter four. Chapter five concludes the report on the major findings, conclusion and recommendations.

2.1 Physical Resource Base 2.1.1 Location and Size Savelugu Nanton district is one of the eighteen (18) administrative districts in the Northern region of Ghana. Savelugu, the capital of the district as our study area, shares boundaries with pong Tamale in the north, Zoggu to the east, Kanshegu in the south and Moglaa to the west. Savelugu is about 25km away from Tamale the regional capital.

2.1.2 Topography and Geology Savelugu is generally flat with gentle and undulating low relief. The altitude ranges between 400ft to 800ft above sea level with slightly hilly within the town and gentle sloping towards pong tamale.

The upper voltaian sedimentary formation characterises the geology of Savelugu and consist of shale and mudstone. This makes borehole drilling in the town less successful.

2.1.3 Climate and Rainfall Pattern Savelugu falls under the guinea savanna climatic zone. The area receives an annual rainfall averaging 600mm, considered enough for a single farming season. The annual rainfall pattern is erratic at the beginning of the rainy season starting in April intensifying as the season advances raising the average from 600mm to 1000mm. Temperatures are usually high, averaging 34°c. The maximum temperature can rise to as high as 42°c and the minimum as low as 16°c. The low temperatures are experienced from December to late February, during which the North-East trade winds (hamattan) greatly influence the town resulting in higher rates of evaporation and transpiration leading to water deficiencies.

2.1.4 Drainage and Vegetation There is no natural water body in the area. Rain water runs through gutters constructed along the main roads.

Savelugu finds itself in the interior (Guinea) savanna wood land which can sustain large scale livestock farming as well as cultivation of staples like rice, groundnuts, yam, cassava, maize, cowpea and sorghum. The trees found in the area are drought resistant and hardly shed their leaves completely during the long dry season. Most of these are of economic value and serve as an important means of livelihood especially for women. Notable among these are shea trees (the nuts of which is used for making shea butter) and dawadawa that provides seeds for condimental purpose.

2.2 Demographic Characteristics 2.2.1 Population Size According to the 2000 population and housing census, savelugu’s population stood at 24,937. Males are made up of 12,213, representing 48.97% and 12724 of females representing 51.03% of the total population.

2.2.2 Household Characteristics Households are predominantly male-headed. The average household size is about 5.6 with the smallest household comprising one member and the largest having 47 members.

2.2.3 Human Settlement Pattern Savelugu has an urban/town council with 2,097 of houses. The settlement pattern in the central business district (CBD) is linear and nucleated with the outskirts of the town being disperse.

2.3 Socio-Economic Characteristics 2.3.1 Micro Economy Savelugu is a subsistent agricultural based economy. Cash crop production is very minimal and includes shea nut, soya beans, cotton and cashew. Agro processing is generally done by traditional methods and on very small scale basis.

2.3.2 Income Levels and Distribution Income levels are generally low. This is due to the fact that majority of the populace depend on rain fed agriculture. Income levels are low for women than for men.

2.4 Socio-Political Organisation Savelugu is one of the paramouncies in the Dagbon kingdom comprising of Dagombas. It is been ruled by a chief with sub-divisional chiefs under him. The chief of Savelugu (Yonaa) is the number one in terms of traditional authority. Information flow is through household heads to the sub-chief and to the chief and then vice versa.

In the modern political system, information is channeled through members of the community to unit committee members, assembly men to the district chief executive who is the highest political authority through the district assembly.

2.5 Human Resource Development and Basic Service 2.5.1 Education The district is zoned into five educational circuits for administrative purposes of which Savelugu is one with 14 primary schools, 5 J.H.S and a senior secondary school. There is also a school for the deaf in Savelugu.

2.5.2 Health Savelugu as a district capital is blessed with a hospital which provides the health needs of the people. The community also has a number of traditional healers who supplement the efforts of the hospital in health care delivery.

2.5.3 Water and Sanitation Savelugu has three dams, five hand-dug wells with pumps and 15 boreholes that serves the water needs of the people. The community also has about 20 KVIPs facilities distributed within the township with dust bins places at vantage positions for solid waste management.

2.5.4 Infrastructure Savelugu has a first class road passing through it from Tamale through to Bolga and to Burkina Faso. It also has electricity, telecommunication services, and community centre among others.

3.1 Introduction Literature review is an essential component of any scientific research since it provides the basis upon which the study will be built and streamlined. The literature review is presented based on Capitation fee, Grant, Capitation grant, and case studies of how capitation grant is practiced in Ireland and Ghana.

3.2 Capitation Fee Capitation fee is something taken over and above what the institution needs by way of revenue and capital expenditure plus reasonable surplus (Nariman, 2005).

Capitation fee is also defined as any amount by what ever name called, whether in cash or in kind, paid or collected, received directly or indirectly in addition to the fees determined by the institution concerned (Kerala Professional Colleges, 2004)

The above definitions fail to state the criteria for payment (as to whether it is per head) of the fees and by whom and for what purpose. It is narrowed to the amount being paid or charged by the institutions concerned and also the surplus it accrues. We then consider the definition below to ascertain whether it answers the question the above definitions fail to do.

Capitation fee is the payment of a fee or grant to a doctor, school etc. the amount being determined by the number of patients or pupil etc. (Wikipedia encyclopedia, 2007).

Capitation fee can also be seen as a system of payment for each customer served rather than by service performed (Moffatt, 2002)

In addition to the above, capitation fee is defined as a method of payment to a provider of medical service according to the number of members in the health benefit plan that the provider contracts to treat (by head or per head). (Ibid)

The above definitions of capitation have suggested that the criteria for payment are based on the number served which is very limited in scope. However, other criteria such as level of deprivation and the worth of the service should have also been considered since it can also influence the success or failure of the programme. It also fail to capture whether the fee paid per head is uniform and does not specify any time and whether the fee is paid in advance or after the service delivery.

After a critical examination of the above definitions, it is safe to adopt the definition of capitation fee by Patrick C. Alguire, (1999) as a fixed amount of money per patient per unit of time paid in advance to the physician for the delivery of health care service.

Widening Alguire’s definition from the health perspective, capitation fee is the fixed amount of money per head per unit time, paid in advance to a service provider for a delivery of the required service. We coin this definition because the actual amount of money paid is determined by the ranges of services that are provided, the number of persons involved and the period of time during which the services are provided.

3.3 Grant The definitions of a grant are various and vibrant depending on the context it is used. A grant could mean to bestow, especially officially; “grant a degree”; “give a divorce”; “this bill grants us new right”. It could also mean a transfer by deed; “grant land”. In another context a grant is to accord: allow to have; “grant a privilege”. To concede: give over; surrender or relinquish to the physical control of another is again a definition of a grant (Wikipedia encyclopedia, 2007).

Even though the above definitions are right in their various context of a grant, they have not fallen under the orbit of our concern. Grants are funds given to tax-exempt nonprofit organization or local government by foundations, corporations, governments, small business and individuals. Most grants are made to fund a specific project and require some level of reporting (Ibid)

Financial assistance awarded to students which does not have to be repaid, usually based on need (Catalog, 1999)

A grant therefore is a financial assistance in the form of money, or property or technical assistance in lieu of money awarded by a government agency or private organization (foundation or corporation) to an eligible applicant to accomplish some public purpose. Simply put a grant is a form of monetary aid that is like a ‘gift’ – it does not need to be repaid.

3.4 Capitation Grant. From the above definitions of capitation fee and grant, Capitation Grant can be coined as a fixed amount of money per head per unit time paid in advance to a service provider for the delivery of the required service and the cost of which is borne by a government or corporate body in a form of aid. In the Ghanaian context, Capitation Grant is a fixed amount of money per head per unit time paid in instalments to public basic schools based on enrolment in place of school fees.

3.5 How Capitation Grant is practiced in Ireland. Capitation grants are intended to be spent on the day-to-day running costs of the school, for example, heating, cleaning, lighting, maintenance of school premises and grounds and the provision of teaching materials and resources. The grant per pupil is paid at the prevailing rate in two instalments. The first instalments (70%) are paid on 31 January of the school year and the balance (30%) is paid on 30th June. The grant for each school year is determined by the number of pupils on roll on 30 September. In case of a newly established school the grant may be calculated by reference to the projected enrolment on 30 September of the following school year. This arrangement will apply for a period not exceeding the first three years of a school’s operation. (Department of Education and Science, Ireland, 2007)

In consultation with the principal teacher, each board is required to arrange annually the allocation of a sum of money for the provision of school requisites. Separate rates of grant are paid to national schools maintained by the Office of Public Works. In the case of smaller schools a specific grant known as a ‘minimum grant’ is paid. Separate rates of ‘minimum grant’ are payable to schools where a board of management has been established and to schools maintained by the Office of Public Works. (Department of Education and Science, Ireland, 2007)

Capitation grants are paid at the rate applicable at the time the grant is issued. In any year where an increase in the rate of payment comes into effect, the second instalment of the grant (issued in June) will reflect the new rate and will also include any arrears in respect of the instalment issued the previous January. (Department of Education and Science, Ireland, 2007)

3.5.1 Use of Capitation Grant Boards of management are required to ensure that all monies provided to the school under this grant are made available for the purchase of appropriate resources and materials. Schools should also keep a record of all materials or resources purchased with this grant and receipts in respect of such purchases should be retained. These receipts/records may need to be produced at a later stage for inspection by officers of the department. (Department of Education and Science, Ireland, 2007)

3.5.2 Abolition of local contribution There is an abolition of the requirement of primary schools to raise a local contribution towards their current operating costs. The effects of its abolition means that schools are no longer required returning forms to this Department certifying that the local contribution has been lodged to their school accounts. This means that the processing of the second instalment of the Capitation Grant will be automatically undertaken by the Department, provided schools have submitted their Annual Return for the school year to the statistical section of the Department. (Department of Education and Science, Ireland, 2007)

3.6. How Capitation Grant is practiced in Ghana. The Ministry of Education has set up a Capitation Grant Scheme, commenced 2003/2004 academic year, where by every primary school receives an amount of GH¢2.50 per male pupil enrolled and GH¢3.50 per female pupil enrolled. This should serve to remove financial barriers created by levies, yet more than compensate the schools for lost of revenue they faced as a result. (GES, 2006)

The capitation grant has been designed to empower the schools to effectively use financial resources to plan and carry out school quality improvement activities. The process of planning activities should be participatory and transparent. (Ibid)

3.6.1 Selection of schools and number of pupils. All registered public schools with the Ghana Education Service are automatic beneficiaries of the capitation grant. The maximum number of pupils per school allowable for each year is to be determined in advance due to audit purposes. It is advisable that the actual enrolment at the end of the third term for the previous year is used as the base and projected by an expected gross enrolment to get the estimated number of pupils to be used for budget purposes. Enrolment numbers for actual disbursement, however, should be based on actual figures. (GES, 2006)

3.6.2 Management of the grant Key players in the management of the capitation grant are: District Directors of Education, Assistant Director Supervision, Circuit Supervisor, District Accountant, SMCs, and the Head teacher. (Ibid)

The capitation grants are to be used to support the implementation of School Performance Improvement Plan (SPIP). Some of the key activities to be undertaken are; provision of teaching and learning materials, school management (including transportation and telecommunication and stationary), community and school relationship, support to the needy pupils, school and cluster based in service training, minor repairs and payments of sports and culture levis (to be approved nationally). (GES, 2006)

The District Education Office would open a special account into which funds for the capitation grants would be lodged. The signatories to this account are the District Director of Education and the District Accountant. To ensure smooth implementation of the schools programme, separate bank accounts would also be opened by the District for each school. The signatories to the school’s account are the Head teacher and his assistant. (Ibid)

3.6.3 Release of funds and disbursement process A project estimate of enrolment levels in each school is made at the beginning of each academic year. This estimate is the bases for the transfer of fifty per cent of funds to the schools at the beginning of the first term. Subsequently transfers for the first term are dependent on the submission of adequate returns on the actual enrolment for the school in the course of the term. For the second and third terms, based on the enrolment levels established in the first term, funds are to be transferred to schools at the beginning of term. Efforts should, however, be made to confirm this enrolment figures due to attritions. (GES, 2006)

An executer of an activity applies to the head teacher and cash is withdrawn and given to the executor to be used for the purpose. After completion the executor accounts to the headmaster with relevant documentations. At the school level, request for the funds are to be endorsed by both the SMC chairman and the head teacher. The school is to maintain financial records which reports all Capitation Grants received and disbursed with all documentation required. (Ibid)

3.6.4 Monitoring and evaluation. The circuit supervisor is to visit each school twice a term and will report to the district education office on the following: abolition of all forms of levies in the school, implementation status of the SPIP and submission of all reports on timely basis. The district directors as well as the District Teacher Support Team (DTST) and district head teacher advisor are to pay regular visit to each school to review progress on implementation of activities at each school. (GES, 2006)

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