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Cabinet approves non-lapsable fund creation for education cess

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The fund will be non-lapsable and the receipts from the cess would be available on a rollover basis for financing elementary education and mid-day meal scheme.

New Delhi , Oct. 7

THE Cabinet on Thursday approved the creation of a non-lapsable Prarambhik Siksha Kosh (Elementary Education Fund) to park the funds received from the 2 per cent education cess levied in last year's Budget.

The Information and Broadcasting Minister, Mr S. Jaipal Reddy, said that the fund would be created and maintained by the HRD Ministry's Department of Elementary Education and Literacy, on a proforma basis, on the lines of a similar non-lapsable central pool being maintained for the development of the North-East region.

The Minister added that the fund will be non-lapsable and the receipts from the cess would be available on a rollover basis for financing elementary education and mid-day meal scheme.

The move to create a non-lapsable pool comes at a time when the Left parties have been asking the Government to spend the funds collected out of the two per cent cess over the past one year.

The Cabinet has also approved a proposal to assure annual plan allocations for elementary education based upon the need.

This would be provided as far as possible from the budgetary resources to the full extent of the gap between the requirement and the estimated cess revenues, he said.

In an attempt to improve the health of children, the Government decided to modify the grant-in-aid pattern of the Integrated Child Development Services scheme by revising the supplementary nutrition cost per child from 95 paise to Rs 2 from October last year.

The Finance Minister, Mr P. Chidambaram, said the Cabinet Committee on Economic Affairs gave its approval to the modification under which the Centre would bear 50 per cent of the cost, that is, Rs 1 per child. For 2005-06, the Centre's share of 50 per cent of the cost is estimated at Rs 1,508 crore.

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