In many developed countries of the world the school system has been divided into the state school and private school sectors. The commentators Adonis and Pollard have recently complained that the education system in England is based on a division between state and private (so – called ‘public ‘) schools with prestige and resources going mainly to the later rather then to the former (Adonis, A and Pollard S 1998). Like Great Britain, education system in Pakistan is also divided into state and private school. The existing state school systems in both Peshawar and Khyber agency are almost the same as that are provided in the rest of Pakistan. In Peshawar and Khyber agency, however, the school system has a further sub-division having state schools, private schools and madrassa schools. Private schools are considered schools for the upper classes, entry to which are generally limited to students from rich families, whilst state schools are generally for lower, middle class people. Madrassa, however, are for those children from lower class family backgrounds who do not have an access to any of the above mentioned schools for a variety of reasons; a key factor being accessibility. The students of madrassa depend solely on charities provided by the general public. In Peshawar only 4.6 million students are enrolled in the Public Sector, Private Sector and Madrassa. The remaining 2.8 million children have no access to formal education (Hussein 2007). Average dropout rates up to Matriculation level are at 38% annually. There are many factors that impact on the drop out including access problems, social and cultural issues particularly among females, poverty, ignorance, lack of financial resources,(with government and families) corporal punishment and so on. More than half of the children in Peshawar drop out of school before completing the fifth grade. On average, females remain in school for 1.3 years and males for 3.8 years.