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Planning commission fights HRD Ministry on profits in higher education

Source : INDIA TODAY
Sept 27, 2012

When resources are limited, philanthropy isn't the best practice. Advocating this mantra, the Planning Commission has retained a suggestion to allow higher education institutions to run for profit in the final draft of the 12th Five-Year Plan. 

 

The proposal wasn't received well by the ministry when it first appeared in the plan panel's approach paper last year. 

 

According to sources, Union Minister Kapil Sibal had even written "about two to three times" to the commission categorically stating his disapproval to the proposal. 

 

The 12th Plan document, a copy of which is with Mail Today, seeks a review of the not-for-profit tag on higher education on the ground that the philanthropy-driven institutions do not have the resources to "bridge the demand-supply gap in higher education". 

 

"Therefore, the not-for-profit status in higher education should perhaps be re-examined for pragmatic considerations so as to allow the entry of 'for-profit institutions' in select areas where acute shortages persist. This should, however, be subjected to the necessary oversight and accreditation arrangements to ensure quality and equity," the final draft states.

 

"For profit private higher education can be taxed and the revenue from it can be channelled into large-scale scholarship programme to promote equity as is being practiced in Brazil and China," the document further elaborates. The final draft is yet to be approved by the National Development Council. 

 

The HRD ministry is sticking to its guns despite the Plan Panel's apparent push to the 'for-profit model' in higher education. Senior HRD officials insisted that the government will not implement the idea even if it is included in the final Plan document. 

 

"The Plan Panel and the ministry are not at loggerheads, but our stand is very clear. You cannot directly suggest a rethink of the not-for-profit model unless it has been through a detailed consultative process. Our current education policy does not allow it. How can we even think of a review?" an HRD ministry official, who did not wish to be identified, said. 

 

HRD minister Kapil Sibal had written to the commission stating his disapproval to the proposa.' title='HRD minister Kapil Sibal had written to the commission stating his disapproval to the proposal. HRD minister Kapil Sibal had written to the commission stating his disapproval to the proposal. Educationists and industry leaders are divided on the proposal to allow higher education institutions to make profit. 

 

"Personally, I am not in favour of the 'for-profit model' because it would allow these institutions to charge a huge fee and will only cater to the segment that can buy education. Moreover, even if the government agrees, I doubt if it will be able to muster political consent on it. I think this suggestion is unlikely to go anywhere," Vinod Raina, educationist and member of the Central Advisory Board of Education (CABE), said.

 

Shobha Mishra Ghosh, a senior director of the Federation of Indian Chambers of Commerce and Industry, however, felt that allowing private institutions to make profit will be beneficial for the education sector as the college or university will be able to raise funds from alternative resources and not only depend on tuition fee. "Institutions need investment to maintain and update infrastructure. Raising funds from alternative sources can help that cause," Ghosh said.

 

The final draft also proposes to allow the not-for-profit institutions to raise funds through public offerings of bonds or shares to attract more private capital.

 

The private institutions in higher education currently account for 58.5 per cent of enrolments. The government has been promoting greater private participation in the form of public-private partnership (PPP) as the state alone does have the funds to scale up higher education to achieve a gross enrollment ratio (GER) of 30 per cent by the end of the 12th Five-Year Plan. The GER, at present, is around 20 per cent.

 

According to sources, the government may soon set up an education commission to draft a new policy keeping in mind the changed social, economic and technological context.


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