Govt Panel Recommends Cap On Fees For MBA, Engineering In Private Institutes

Tuition fees for courses such as MBA and engineering in private institutes may come down if recommendations of a committee headed by former Supreme Court judge B N Srikrishna are accepted.

The committee has fixed the maximum fee (tuition and development) for a two-year management course in the range of Rs 1.57 lakh to Rs 1.71 lakh per annum, depending on the location of the institution.

The upper limit for the four-year engineering degree (BE or B.Tech) will be in the range of Rs 1.44 lakh to 1.58 lakh per year.

It has also suggested the maximum fee for technical courses such as B.Arch, B.Pharma, MCA and M.Tech, among others.

The Justice Srikrishna committee was set up by the All India Council for Technical Education (AICTE) following the Supreme Court’s direction in the TMA Pai Foundation case.

The apex court’s directive was aimed at preventing commercialization of technical education. It ruled that the fee charged by private institutes should be decided by the state governments till such time a national-level fee fixation committee came out with its recommendations.

All India Council for Technical Education (AICTE) Chairman Anil Sahasrabudhe, told Indian Express that the committee report has been received and forwarded to the HRD Ministry for consideration.

The Ministry may consult experts and stakeholders for their views, he told the paper.

If the Ministry accepts the recommendations, all private institutions taking more than the prescribed fee limits will have to fall in line.

However, the report makes an exception for institutions of excellence by allowing autonomous and accredited ones to charge another 10 per cent and 20 per cent additional tuition fee from the students, respectively.

AICTE officials refused comment about what will happen to top institutes whose fee structure exceeds the maximum limit even after factoring in the exception made for excellence.

The Xavier Labour Relations Institute (XLRI) in Jamshedpur, for instance, takes Rs 9 lakh per annum for its two-year post graduate diploma in management, (equivalent to pre-experience Masters in Business Management as per AMBA, UK and equivalent to MBA as per AICTE).

The TA Pai Management Institute in Manipal or TAPMI and SP Jain Institute of Management and Research, Mumbai, charge Rs 7 lakh and Rs 4.45 lakh every year, respectively, for their two-year course.

Fee for One Year MBA courses have not been recommended by the panel. The fee for post-experience One Year MBA courses at most private colleges in India ranges between 26.7 lakh and 12 lakh with the highest fee being that of Indian School of Business which charges 26.7 lakh for its one-year MBA.

Here are some of the highlights of the report:

1. Private institutes and colleges can charge fee under four heads – tuition, development, examination and others.
2. 2. Tuition fee covers expenses on human resources (faculty and non-teaching staff) and learning resources such as library books and operational costs (electricity, water, maintenance etc).
3. 3. Development fee is meant for future development of the institute and cannot exceed 15 per cent of tuition fee. The maximum fee recommended by Srikrishna Committee (see box) covers tuition and development heads only.
4. Examination fee can be taken by institutes that are affiliated to universities. The total amount charged under the ‘Others’ head, which covers contingency fund, placement, medical, counsellor and industry participation, shall not be more than Rs 1,000 or 1 per cent of the tuition fee, whichever is higher.
5. Exceptions may be created in cases of excellence. Private institutions and colleges which have accreditation for at least two-thirds of their courses can charge an additional 20 per cent of the prescribed tuition fee. Autonomous institutes and colleges can charge 10 per cent additional tuition fee.
6. Institutes can take higher tuition fee from those enrolled under the foreign student category, but it should be limited to a maximum of three times the prescribed limit. It has to stick to the ceiling in case of all other students.
7. HRD and AICTE should set up appropriate mechanism to ensure strict adherence to fee guidelines.
8. The fee will be increased by just 5 per cent every year till it is reviewed. So if a student, say, pays Rs 1,000 in year 1, he or she will pay Rs 1,050 in year 2, Rs 1,102 in year 3 and Rs 1,158 in year 4.
9. The government should facilitate scholarships and financial aid to offset the burden of fee on reserved category and economically weak students. (With inputs from Indian Express, image courtesy studentopress)