The  Union Cabinet today gave its approval to the following proposals :

            i) Creation of a non-lapsable fund for elementary education – ‘Prarambhik Shiksha Kosh’ to receive the proceeds of the Education Cess imposed by the Finance (No.2) Act, 2004, as well as unspent balances relating to Elementary Education under Major Head 2525 - meant for North-East States.

ii) That the Elementary Education sector shall be assured  Annual Plan allocations based upon  need, and would be provided, as far as possible, budgetary resources to the full extent of the gap between the requirement and the estimated Cess revenues for the year.

To bridge the gap between available plan allocation and estimated financial requirements, an Education Cess  @ 2% on Central taxes was levied through the Finance (No.2) Act, 2004, “ to fulfill the commitment of the Government to provide & finance universal quality basic education”.

A non-lapsable fund for Elementary Education to be known as “Prarambhik Shiksha Kosh” would be created and maintained by the Ministry of Human Resource Development( HRD), Department of Elementary Education & Literacy (EE&L), on  a proforma basis on the lines of the Non-Lapsable Central pool of Resources (NLCPR) for the North-Eastern Region (NER). The fund will be non-lapsable and receipts from the education cess will be available on a roll-over basis for purposes of financing elementary education and the mid-day meal scheme”.

Savings under Major Head 2552 ( pertaining to North Eastern region) at the end of a financial year, relating to Elementary Education, shall henceforth be credited into PSK instead of NLCPR, with the proviso that such savings will be separately accounted for, and utilized only in the North Eastern Region and Sikkim.

YSR/DS/HK/LV