The Right to Education (RTE) Act, 2009 mandates a 25% reservation for children from economically weaker sections (EWS) and disadvantaged groups (DG) in private unaided schools, with financial reimbursement from the state. Tamil Nadu has historically been regarded as a socially progressive state in education, but persistent delays in RTE reimbursements have strained the private schooling sector. Even though Samagra Shiksha (SSA) and RTE accounts were separated to streamline fund flow, and the Central Government released approximately ₹700 crore towards pending claims for 2023–24 and 2024–25, reimbursements to schools remain delayed. This article critically examines the underlying reasons behind the continuing delays, assesses legal and administrative gaps, evaluates the impact on stakeholders, and proposes policy-level interventions for systemic improvement.
1. Introduction
The RTE Act envisions an inclusive model of schooling where private unaided institutions share responsibility for educating underprivileged children. In Tamil Nadu, nearly 1.2 lakh students are admitted annually under the 25% reservation clause. Yet, repeated delays in government reimbursements have sparked protests, litigations, contempt petitions, and widespread dissatisfaction among private schools.
The unique situation in Tamil Nadu—where the state received about ₹700 crore in RTE-specific funds from the Centre, and SSA and RTE heads were separated, but reimbursements still did not reach schools—raises critical questions about governance, fund utilization, and administrative coherence.
2. Background: RTE Implementation in Tamil Nadu
Tamil Nadu has consistently maintained high literacy, strong public schooling systems, and an active private sector. RTE implementation is supervised by the Directorate of Matriculation Schools and the School Education Department.
Key operational features include:
- Centralised online portal for RTE admissions
- Lottery-based selection mechanism
- Annual submission of claims by private schools
- Joint funding model: 60% Centre, 40% State
Tamil Nadu was one of the first states to separate the financial heads of SSA and RTE following national criticism that combining the two created accounting bottlenecks.
3. Funding Dynamics and the ₹700 Crore Central Release
In 2023–24 and 2024–25, the Central Government released nearly ₹700 crore specifically for RTE reimbursements to Tamil Nadu after persistent demands and court-mandated directions. This was intended to clear outstanding dues from multiple years.
Despite this:
- Schools did not receive full reimbursement.
- The State Government cited “procedural delays” and pending state share contributions.
- Private school associations filed contempt petitions before the Madras High Court
The biggest question arises: If RTE funds were separated and Centre released funds, why has the delay persisted?
4. Reasons for Continuing Delays
4.1 Administrative Bottlenecks Despite Fund Availability
The School Education Department has been slow in:
- Verifying claims district-wise
- Reconciling school data
- Issuing sanction orders for disbursement
- Matching Utilization Certificates (UCs) for central auditing
Some district offices lack dedicated RTE staff, delaying claim processing.
4.2 Delayed Contribution of the State’s 40% Share
Even though the Centre released funds, the State must still add its share before disbursing the amount to schools. Budget constraints, delayed approvals, and treasury procedures have slowed this step.
Delays in Fund Transfers from State to School Accounts
- Even after approval, the delay in the final transfer due to treasury bottlenecks leads to schools waiting years for actual payment.
4.3 Utilization Certificate (UC) Delays
Before the next tranche of funds can be released, the State must submit UCs for the previous year. These certificates often get delayed due to:
- Complex multilayered verification
- Lack of district-level accounting support
- Incomplete school data
4.4 Policy Tensions Between Centre and State
Tamil Nadu has opposed the National Education Policy (NEP) 2020. At several points, fund flow under RTE was reportedly affected due to:
- Non-alignment with national reforms
- Delays in Centre–State financial consultations
- Conditionality disputes
This created uncertainty in the administrative pipeline.
4.5 Legal and Bureaucratic Delays
Despite repeated Madras High Court directions to expedite payments:
- Sanction orders have not been issued within mandated deadlines
- Payments were postponed citing financial year closing
- Internal file movement remains slow
The High Court characterised the duties of private schools (admission) and the State (reimbursement) as “inseparable like conjoined twins,” but enforcement gaps persist.
5. Impacts on Stakeholders
5.1 Impact on Private Unaided Schools
- Inability to pay staff salaries on time
- Increased financial burden on low-fee schools
- Stalling of development and maintenance works
- Growing reluctance to admit RTE students
5.2 Impact on Students and Families
- Delayed admissions
- Risk of denial or deferment at private schools
- Psychological stress among parents asked to pay upfront
5.3 Impact on the State’s Educational Reputation
Tamil Nadu, known for its educational leadership, faces criticism for:
•Lack of financial transparency
•Failure to adhere to court deadlines
•Potential disenchantment among private education partners
6. Legal Landscape and Recent Judgments
The Madras High Court has issued several directions:
•Instructed the State to clear RTE dues within 12 weeks.
•Directed the Centre to consider delinking RTE funds from SSA fully.
•Emphasized that lack of central funds is not a valid excuse for delaying school reimbursements.
•Stated that RTE and reimbursement obligations are “Siamese twins,” implying legal inseparability.
Multiple contempt petitions filed in 2025 highlight ongoing non-compliance.
7. Need for Systemic Reform: Recommendations
7.1 Ring-Fenced RTE Budget
Dedicated Budget Head for RTE Reimbursements
•Funds must be pre-allocated and protected solely for RTE payments and not clubbed with general education budgets.
Create a separate RTE fund with:
•Quarterly allocations
•Zero diversion clauses
•Public disclosure of fund status
7.2 Time-Bound Disbursement Rules
Absence of Statutory Timeframe
•There is no legally binding timeframe within which the state must process or release reimbursement payments.
Mandatory Time-Bound Disbursement Protocol
•State should issue a Government Order (G.O.) specifying timelines (e.g., reimbursement within 90 days of claim).
Introduce a Government Order mandating:
•District-level verification within 45 days
•State sanction within 30 days
•Final reimbursement within 15 days
7.3 Strengthening Digital Infrastructure
Upgrade the RTE portal to:
- Auto-verify Aadhaar and bank account details
- Track claim status in real-time
- Issue automated sanction orders
7.4 Dedicated District RTE Cells
Appoint trained officers solely for:
- Reimbursement processing
- Fund audit
- Parent-school grievance redressal
7.5 Pre-Funding or Interim Advance System
Provide an advance subsidy per RTE student at the start of the academic year, adjusted after final verification.
7.6 Annual Report on RTE Financial Compliance
The State should release a yearly report covering:
- Total students admitted
- Funds received
- Funds disbursed
- Pending liabilities
Such transparency enhances public trust.
8. Conclusion
Despite improvements in administrative architecture—such as separating SSA from RTE accounts—and despite the Central Government’s release of ₹700 crore, Tamil Nadu continues to face serious delays in reimbursing private unaided schools under the RTE Act. These delays undermine the constitutional promise of equitable access to quality education and erode trust between the government and private institutions.
To uphold the spirit of the RTE Act, Tamil Nadu must adopt a coordinated, transparent, and accountable funding mechanism. The State’s strong reputation in education can be preserved only through timely reimbursements, proactive governance, and sincere compliance with judicial directions.
The future of 7 lacs and add number of children admitted under the RTE mandate depends on a system that works as promised—efficiently, ethically, and without unnecessary delay.
Article by
Adv.M.J. John Arokia Prabhu
Adv.Martin Kennedy
School Voice, Chennai
