Fee regulation and the parent
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The woes of parents who are striving to give their children quality education seem to have no end. Of late many cities across India have seen parents protest arbitrary and “unfair” fee hikes by private schools. For instance, in Delhi and Mumbai, the fee hike in private, unaided schools in 2017 varied between 10 % to 40 %. April 2019 alone witnessed protests against fee hikes across various states including Telangana, Maharashtra, Delhi, Uttar Pradesh, Haryana, Rajasthan and Madhya Pradesh, where parents demanded better implementation of the Fee Regulation Acts in their respective states. Trusting these laws to regulate and control the fees, parents welcome such government interventions since lower costs could be instrumental in increasing accessibility to private schools, where learning outcomes are evidently higher. States like Tamil Nadu, Uttar Pradesh, Uttarakhand and Assam already have their own laws for regulating the fee structure in private schools.

The underlying principle behind such legislation across all states is that before increasing fees, schools have to consult a regulatory committee comprising representatives from the district administration, the education department, parents, and school management. Additionally, the annual fee hike must be less than 10 per cent and the schools must display the fee structure on their websites in advance. The Act also has provisions for imposing fines on schools that do not follow its directives. But will these regulatory committees act as an antidote to the problems of arbitrary fee hikes, which subjects parents to a constant struggle to afford even basic education?

These policies seem to have evolved as a knee jerk reaction to the demands and demonstrations by parents agitating against exorbitant fees of private schools, without deliberations on the practical needs and constraints of the education sector in India. Private school associations have been in opposition to these Acts throughout the process of their implementation. They have sought help from the judiciary, individually and as groups, to remedy this situation. The underlying assumption in such policies is very clear- these are the only types of private schools that exist. But this is not the reality.

There is merit in inspecting the root cause of the frequent and allegedly arbitrary fee hikes. A major reason behind the exponential rise in private schools’ fee is that the supply of these schools does not meet the high demand. There are about 3,50,000 private, unaided schools in India — 24% of all schools — where 75 million children, or 38% of all students, study. The preference for private schools can be attributed to a variety of reasons- better learning outcomes, greater accessibility, social aspirations attached to an English medium private education, and provision for extracurricular activities among others. With no grants or assistance from the government, these schools generate their own revenue through school fees to operate. There has been a steady increase in the fraction of parents abandoning free government schools in favour of fee-charging private schools.

A 2017 research paper The Private Schooling Phenomenon in India: A Review by Geeta Kingdon Gandhi, analysed raw District Education System on Education (DISE) data on 20 states of India, over the four-year period between 2011 to 2015. Her study shows that despite an adequate increase in the number of government schools, the total enrolment in these schools decreased by 11.17 million students, while the enrollment in private (aided and unaided) schools increased by 16 million students. This shows that the aggregate enrolment in private schools is increasing at a higher rate every year than the increase in the total number of private schools. This could be a result of the increased administrative responsibilities under the Right To Education Act and revision of teacher salaries (7th Pay Commission) which have resulted in the increase of the overall costs of operation of private schools. Contextually speaking, parents want the fees to be lowered because of the low availability of quality schools, which charge a higher fee due to high demand and higher operational costs, making it unaffordable for many. Simply put, the supply does not match the demand.

Add to this the fee regulations and other mandates under RTE which end up creating entry barriers for aspiring ‘edupreneurs’, who wouldn’t be willing to start schools since there is a lack of monetary incentive, all this leading to a stagnation in supply against the ever-rising demand. Producers who see no chance of making profits have no incentive to set up an enterprise. Even if they choose to operate at minimal or no profits, the pressure of improving quality would drive them to increase the number of pupils per teacher adversely affecting the learning outcomes.

Despite private schools being at the heart of the problem, the solution too lies with private schools. But not the ones you think. According to the Annual Status of Education Report (ASER) 2016 data, up to 80% of private schools in India are ‘low’ fee schools when benchmarked against government schools’ per pupil expenditure. This implies that the majority of the private schools charge low fees and function for disadvantaged members of the society while bearing the weight of additional compliance costs under the RTE. Hence, the complaints against unreasonably high fees charged by private schools are relevant for only a small section of elite private schools in urban centres of the country.

It is indisputable that private schools’ fees have been growing considerably and to keep private school education affordable and accessible, the government should take into cognisance the policies which might be stimulating this rise and fix the policies. Private unaided schools are already burdened with innumerable expenditures – commercial tax for electricity/water, property tax, permit for school buses, infrastructure compliance cost, reservation, lease, salaries as per 7th Pay Commission etc. Additionally, over-regulation and mandates from various departments and institutions such as the education department, CBSE/ICSE/other affiliated boards, child protection commission and Non-Government Organisations, Income Tax department, fee commissions, the courts etc. have already put tremendous pressure on private unaided schools.

The way forward is to relax the regulations and taxes imposed on private schools to ease the opening of new schools and to increase competition and innovation in the private school sector. Availability of choices would eventually bring down the fee and also up the quality of education since each school would want to outperform the other to attract more students and parents. The government should shift its focus on improving the standards of infrastructure, teaching and learning outcomes of government schools instead of bullying private entities to carry out the welfare function on behalf of the state, which is failing miserably. Regulatory bottlenecks could push private schools towards performing poorly given the high costs of compliance which would take funds away from quality improvement efforts. In conclusion, ideally, parents should be demanding ease in regulatory barriers put in place for private schools by the government in order to get the best quality of education at affordable costs.

Read more: https://spontaneousorder.in/school-fee-regulation-in-india/

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The opinions expressed in this essay are those of the authors. They do not purport to reflect the opinions or views of CCS.