Fee Regulation in Universities: Check profiteering, but let not quality suffer
Dr. S.S. Mantha, 05 Apr 2019
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Commercialisation of higher education for profiteering must be checked, but not at the cost of quality education…


In 2017, Supriya Sule, Member of Parliament, moved a bill to provide for regulation of fee in higher educational institutions with a view to make higher education accessible to all. Objectives mentioned for moving such a Bill seem to be valid. However, it must be discussed in a larger context. India is one of the few countries to have relatively younger workforce. To benefit from this demographic dividend, it is important to invest in its youth and to make them more productive. Imparting of higher education and skills acquired through it are necessary for progress of a developing nation. The Bill further adds that commercialisation of higher education with the motive of profiteering must be checked. True to the last word, but what is the reality? A Bill, if passed, applies equally to all facets of higher education including technical. Without being judgemental on all higher education, let us analyse just one facet, that of technical education.

India’s higher education structure 


India has one of the largest higher education systems in the world, primarily dominated by private players who account for 90% of the total institutes and 85% of total enrolment of students, at least in technical education. The numbers are about 65% in rest of higher education. The higher education sector in India has a three-tier structure comprising the university, college and course. This forms a vital link with the regulatory structure, and with accreditation agencies playing a key role in maintaining quality and standards. With very little regulatory control within the private education, not only the numbers of students, but the fees charged too, have risen disproportionately which probably is the larger concern. Profiteering and racketeering must certainly be checked. Good among them must not, however, be punished. 


Fee regulation

The Supreme Court of India in its various judgments has ruled in favour of regulation of fee in Higher Educational Institutions (HEIs). Any move to regulate the fee in educational institutions will promote the access to higher education. In TMA Pai Foundation v/s State of Karnataka (2002), the Supreme Court ruled that the fee charged by private unaided institutions can be limited by the State to prevent profiteering, while allowing for ‘reasonable surplus’. In 2003 in Islamic Academy of Education v/s State of Karnataka (2003), the Supreme Court observed that the Educational Institutions can form their own fee structures, and the funds must be used to provide facilities to students and to further the growth of the educational institutions. In line with the Supreme Court’s judgment, some States did set up Committees to monitor the fee structure of HEIs. But, there is no framework at the national level prescribing the criteria for limits on fee and the definition of terms ‘reasonable surplus’ and ‘profiteering’. The proposed Bill aims to provide a broad framework for regulation of fee in Higher Educational Institutions.

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Static enrolment

Currently, an oversupply has been the bane in the absence of new numbers joining at the entry level. It is a matter of concern that the enrolment has been almost static for the past five years, whereas the younger population has been rising. Quality of education is important, and those that do not provide quality eventually close. Several interventions and innovations would be needed, leading to bigger investments. So, how prudent is it to regulate the fee to be charged? When the fee is pegged, the quality initiatives will take a hit. We are all privy to erstwhile Andhra Pradesh government providing a tuition fee waiver to most of the students, irrespective of their caste and being unable to reimburse the private institutions. So, pegging the tuition fee to ridiculously low value to offset own liability, leads to a general decline in both standards and outcomes.


Multitude of regulations

Market forces can force an entrepreneur to close his institute. There are several institutes in the government sector with a serious quality deficit. There are no teachers in several colleges in remote locations. Can we afford to close them whatever be the fees charged? Today the institutes have to work under a multitude of regulations and have no autonomy. The fee is pegged by every state through a State Fee Committee (SFC) who have their own yardsticks for what is required and what is not. Some like the Bombay University have an archaic process of teacher approval where procedurally appointed teachers are required to seek further approval which takes ages to come. The SFC, however, does not allow the salary paid to them as admissible expense. The expenses incurred on branding or pegging a fee for the subsequent four years at the same value does not seem to be based on sound logic. A 1:20 faculty to student ratio if exceeded from a quality perspective also is seen as inadmissible. How does one add more faculty in such a scenario? Will not an escalation of 5% every year be more pragmatic? Good faculty do not come cheap. Good infra does not come cheap. 


Fee anomalies

Need for a course is largely based on people perception on the employability it can provide. For example, Biomedical may be less preferred than Mechanical. It makes more sense if some kind of cross subsidy is allowed like the fee for Biomedical being lesser than the fee for Mechanical engineering course, with the loss taken care of. In the absence of such progressive interventions, there is a possibility of biomedical course being completely closed. The fee regulation must account for such anomalies that have crept in the system. 


Need for breathing space for institutions

There seems to be no logic for treating all institutions as profit making bodies and higher education as profiteering, for all institutions are set up as trusts and are subject to audit by the charity commissioner who ensures that they do not make profits. Why subject them further to a fee regulation? Probably implementation of Justice Sri Krishna’s report on fee regulation would go a long way in bringing sanity to a vexed problem.   


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Dr. S.S. Mantha,

Former Chairman, AICTE

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