An article in The Financial Express points out that the education cess collected has not been really spent on education at all! Read FM’s education cesspool.
When the education cess of 2% was levied on all taxes, no one grudged the payment. The collections are estimated to be Rs. 5,010 crores, fairly close to the projections P.Chidambaram made. Which means, the education budget should have gone up by this number. Instead the money spent on eductaion has only gone up by about Rs. 2,000 crores over what was spent in the previous year. Rs. 3,000 crores have been used up by the Government to cover up for its profligacy elsewhere.
Cess was vehemently opposed by certain economists when Chidambaram introduced it in his interim budget. However I felt that it was acceptable as long as the money really went into education. In fact, the expenditure on education - if it can be seen as an investment towards future - should go manifold up. But if the Government cannot formulate a policy on where this money is going to go, why tax the people at all?