Education | June 2008

______________________________________________________________________________

Learning without Values
Irrational fee hike in elite institutions

BY ARUN KUMAR *

The news of the IIM, Ahmedabad, raising its fees to Rs 11.5 lakh for a two-year MBA course stunned many. The ground had been prepared by the announcements from the other IIMs that they were raising their fees by substantial amounts. After these announcements, the IITs are also expected to hike their fees. These may be moderate compared to what the IIMs have announced but substantial compared to the existing fees.

Of course, all this affects only a few thousand students out of the several millions who are in higher education. As such, one could dismiss these as of little consequence to the average student. The news may also be discounted given that the private colleges that are no patch on the IIMs have already been charging huge fees. However, pressure to raise fees is building up in other public elite institutions. Many arguments are proffered for raising the fees by the IIMs.

First, those who go to these super-elite institutions earn enough; so why should they not pay for their education? It is being suggested that the deserving students from these institutions will be given loans or scholarships to finance their education and since they will earn high salaries, no difficulty may be expected in the repayment of the loan.

Secondly, many of the students from these elite institutions leave India for greener pastures abroad and have little commitment to the country; so, at least they should finance their own education and not depend on the subsidy from the state. The resources so released could be then used to finance the education of poorer students. Thirdly, if these students were to study in similar institutions in the US or the UK, they would have to pay fees many times the enhanced fees; so they are still better off.

Fourthly, the IIMs and IITs should be made autonomous, released from the control of the ministries that indulge in bureaucratic and political interference and for that their finances have to be improved. Fifthly, the faculty of these institutions needs to be better paid to draw talent while at present they are constrained by the UGC-determined scales and these are far lower than the salaries not only in the corporate sector but also in the private higher education institutions that are bleeding talent from them.

Finally, the faculty of these elite institutions is hardly doing any research since it is busy in consultancies and projects to increase incomes. Higher salaries could then reduce the financial pressures and enable the faculties to do more research. All of the above are powerful arguments for raising fees in these institutions to full cost.

To put all this in perspective, one needs to consider that only a few lakh individuals (less than 0.05 per cent of the population) declare incomes of above Rs 10 lakh. Many of these individuals after paying taxes would find it difficult to pay the fees of their children aspiring to study in these institutions. A fee of Rs 4 lakh per annum would be 11 times the per capita income. In contrast, in the US, an elite institution would charge tuition of about $35,000 and living expenses would be about $15,000 so that the total expense would be in the range of the per capita income (about $44,000).

Crudely speaking, an average family in the US can think of sending its child to such an institution. This would be out of the question in India at the fees fixed now.

Have these institutions (IITs and IIMs) built their reputation by charging high fees? The fees have risen sharply only in the last 10 years whereas their reputation was built over the earlier 30 years during which period they charged lower fees and imparted quality education. What matters most for quality education is the commitment of the students and the teachers. During the hey days of the national movement with a commitment to the national cause, there emerged Raman, Bose, Saha, Vishwesharaiya and many others who made great contributions to learning (world class) even with meager resources. Those days there was a low level of literacy and even less of higher education, so the pool of talent was tiny. Yet, due to the commitment, some great work was done.

Higher education is not just about acquiring skills but also about inculcating a higher social value system in the citizens. Today, the latter is being sacrificed at the altar of money making with commitment to the self rather than the nation. In this milieu, presently even though far larger resources are poured into higher education compared to those available during the pre-Independence period, the results are hardly commensurate with the facilities available. While it is true that the facilities are not comparable to what may be available in advanced nations, but is that critical? In very advanced research, expensive equipment and a lot of infrastructure may be needed, but is that also the case with college education, like, in the IITs or in the IIMs? Does one need airconditioned class-rooms or fancy floors and furniture or foreign faculty or visits abroad for good education? It is in all this that resources are being wasted, and these could have been used to educate the others.

Was our original vision of “cheap education” for all a flawed one? Does it occur to the policy makers and educationists that there may be something wrong in wasting such vast resources so that a few can study in comfort and generate huge profits for the owners while the majority of the citizens are deprived of even the basic needs? It is this value system (widespread during the national movement) that is being wiped off our consciousness. Knowledge Commission recommendations are a pointer to a substantial rise in fees and this would lead to segregation in higher education much like between private and government schools.

While scholarships and loans are being promised, many middle class (much less the poor) families cannot take the risk involved in the case of some mishap to their child or if market conditions suddenly change. It requires courage to go in for a loan way beyond one’s means when uncertainties are great. Since the paying capacity of the family depends on the saving capacity, a vast majority of the middle class would also not be able to think of taking the huge loans that would be required.

Cheap and quality education gives equal opportunity to all. Many of the poor families are disadvantaged because their children do not get the same environment for learning as the better off families are able to provide. While little can be done about this disparity, cheap and good education is essential in a democracy to at least formally provide all children an equal opportunity in life. That is why some argue for a common school system.

Education is a case of market failure since a lot of talent is misdirected. Talent is wasted when the talented poor are unable to continue education because the market makes it expensive or when it directs it into less demanding management functions rather than into research and teaching jobs requiring the highest levels of skills. Consequently, state intervention through subsidisation of education is called for.

Clearly, education is about the future; so the view the elite in society takes about it also reflects its vision. We are moving in the direction of giving up our liberal view of higher education and the notion that the poor also should be offered an equal opportunity in society. The first step in the slide of the vision of these institutions began with the appointment of many businessmen and managers (non-educationists) on their boards.

In a poor country, should we produce at a high resource cost highly alienated youth who are not able to relate to the common man and see him as a millstone around their neck, holding back their progress? The basic tenets of our post-Independence society are under assault even if only (to begin with) a few thousand students annually will be affected by the changes being brought about by the IIMs and are likely to be followed by the IITs. 

Dr. Arun Kumar is the Coordinator of the EXIM Bank-JNU Library in Economics. He is teaching Economics in Jawaharlal Nehru University since 1984. He has been the Chairperson of the Centre for Economic Studies and Planning of JNU, Vice President and Acting President of the Indian Academy of Social Sciences (ISSA). This is  based on the one first published in The Tribune on April 29, 2008.