Bill Gets Parliament Approval, IIMs Can Award Degrees Now

The Indian Institutes of Management Bill 2017 that promises to grant administrative, academic and financial autonomy to the IIMs and allow them to award degrees to their graduates has received Parliament approval with its unanimous passage in the Rajya Sabha.

Having already secured the Lok Sabha approval in the previous session of Parliament, the Bill will now be sent to the President for his assent after which it will become a law.

Introducing the Bill in the Upper House on December 19, Union Human Resources Development (HRD) Minister Prakash Javadekar said it gives ‘Institute of National Importance status’ to the IIMs.

At present, the IIMs award postgraduate diplomas and not degrees. Though these institutes have earned a good name all over the world, the diploma holders face many difficulties the world over while registering for PhDs for further studies, post-doctoral and other research facilities.

Once it receives the President’s assent, the Bill will become an Act and with its commencement, all existing Institutes will become a body corporate by the existing names.

Therefore, this degree awarding power to be given to the IIMs is a very important aspect of this Bill, the Minister stated.

“More importantly what we are changing is the whole culture of running the higher education institutions. Here, we are offering them near complete autonomy for excellence and autonomy for really achieving greater heights in education,” he added.

Until now, the Government had a major say in the appointment of IIM Directors and the Board Chairman. Three names would be referred by the Board of Governors and the Government would select one of them. Likewise, the Chairman was also appointed with Government approval.

Since the Government was helping the institutes in the initial seven years for their infrastructure needs as well as in meeting their recurring expenditure, the files had to be referred and every decision gets endorsed by the Ministry.

“Today, Indian Institute of Management, Ahmedabad and others, like in Kolkata, Lucknow or in Bangalore and other IIMs have earned their reputation by their hard work and excellence. Therefore, this excellence must now get autonomy,” Javadekar said.

Thus, the present Board of Governors will appoint the next Board of Governors and they will appoint the Chairman and also the Directors. That is how the world-class institutes function world over and that the Government does not interfere, he added.

“And, here also, we are also not interfering now. We will withdraw the four representatives of the Government and there will be representatives of the alumni. Good universities world over are run by the participation of the alumni,” he added.

However, there has to be the Parliamentary scrutiny since the government is providing finance and there will be CAG (Comptroller & Auditor General) audit. The Institutes will abide by the national laws but the rules also will be placed before the Parliament. So, there are two points where the Parliamentary scrutiny will be done but barring that, there is no interference of bureaucracy and there is no interference of Government, the Minister said.

Even in the Council of All Indian Institutes of Management, the Minister will step down as Chairman and the Council will elect its own Chairman to conduct the coordination activities, he added.

Subsequently, the Bill was passed unanimously in the Rajya Sabha after a short debate.

The draft Bill, introduced in 2015, had undergone major changes after objections were raised by the IIMs over certain clauses seen to be restricting the autonomy of the Institutes in the selection of the Director and certain other provisions.

Two clauses especially, 3(k) and 36(1), had proved to be irksome under which the IIMs would have had to seek the government’s approval for every decision, including fee structure, admission criteria, the formation of academic departments, salary of the staff and constitution of the Board of Governments.

Subsequently, the controversial provisions were dropped and the Bill received the Union Cabinet’s assent in January 2017.

The Statement of Objects and Reasons in the Bill states that the IIMs provide post-graduate, doctoral, post-doctoral and research education in the field of management and allied areas of knowledge.

Being registered under the Societies Act, IIMs award to their students Post-graduate Diploma in Management and Fellow Programme in Management and are not entitled to use the nomenclature of Master of Business Administration (MBA) or PhD degree as issued by a University or Institution of National importance.

“While the Post-graduate Diploma in Management programme (equivalent to MBA) was relatively unaffected by the absence of a formal degree, the Fellow Programme in Management (equivalent to Ph.D), without the formal degree nomenclature, has not been able to attract enough students required to develop a strong research base in the country in the field of management education and also address the faculty shortages affecting the management institutions in the country,” it said.

IIMs having grown into Institutions of global repute, it was felt that they may be enabled to award degree to their students, through an Act of Parliament, which would declare them as Institutes of National Importance,” it noted.

“In view of the above, it becomes necessary to have a Central Legislation, namely the Indian Institutes of Management Act, 2017 in the larger interest of students. The degree-granting power to IIMs will not only enhance the universal acceptability of degrees being awarded by these premier institutions but also empower these institutions to attain standards of global excellence, especially in management research,” it added.

Once it receives the President’s assent, the Bill will become an Act and with its commencement, all existing Institutes will become a body corporate by the existing names. Each institute “shall be open to all persons irrespective of sex, race, creed, caste or class, and no test or condition shall be imposed as to religious belief or profession in admitting or appointing members, students, teachers or workers or in any other connection whatsoever.”

Admission to every academic course or programme of study in each Institute shall be based on merit assessed through transparent and reasonable criteria. However, reservation in admissions will be provided as per Central Educational Institutions (Reservation in Admission) Act, 2006, the Bill stated.

There will be the Board of Governors as the principal executive body of each institute. The Board will be responsible for the general superintendence, direction and control of the affairs of the Institute. The powers will be exercised by the Board as per regulations framed by the Board of Governors.

The Director of the Institute will be appointed by the Board, out of the panel of names recommended by a search-cum-selection committee to be constituted by it.

The Director will be the Chief Executive Officer of the Institute and shall provide leadership to the institute, exercise powers and perform the duties as may be assigned to him under this Act or the regulations or as may be delegated to him by the Board.

A coordination forum will be established with an eminent person as its Chairman to be selected by a Search-cum-Selection Committee constituted by the Coordination forum to consider matters of common interest to these institutes and facilitate the coordination amongst various institutes, sharing of experiences, ideas and concerns with a view to enhancing the performance of all Institutes.