The Hindu Business Line : Financing higher education

POST Independence, India has made significant progress in the field of education. The number of universities has increased from a mere 28 in 1950-51 to above 300, and the number of colleges from less than 700 to over 16,000 today.

The enrolment in higher education has swelled from less than five lakh in 1950-51 to about one crore. Yet, higher education still remains inaccessible to the poorest groups of the population. Quality too is a serious concern. `Empowerment of higher education,' as the President, Mr A. P. J. Abdul Kalam, observed, is the need of the hour. Higher education needs to be empowered, as this alone can lead to sustainable social, economic and political development of society and some equity.

Empowerment of higher education requires liberal government funding. But this has been far from satisfactory. "Part of the problem facing universities is the inadequate provision of budgetary resources from the government," notes the Tenth Five-Year Plan document. Higher education is in a deep financial crisis, with escalating costs and increasing needs of the system, on the one hand, and shrinking budgetary resources, on the other. As a result, several universities and institutions are continuously in deficit.

Economic reform policies have also added to the burden of financial hardships. Some of the recommendations of the Dr Justice Punnayya Committee and Dr Swaminadhan Committee on mobilisation of funds for higher education have been implemented and some have not. Even those that were implemented have not necessarily produced desirable results.Given (a) the public good nature of higher education, (b) the current level of development of higher education, (c) the role of higher education in socio-economic, political and cultural development, and (d) the inequalities in society, in general, and higher education, in particular the need for according a high priority for higher education in development planning is obvious.

In this background the recommendations made by the Committee on `Financing of Higher and Technical Education' of the Central Advisory Board of Education (CABE), constituted by the Government of India deserve serious attention by both the Union and State governments. The Report presents a comprehensive review of the trends, policy issues and problems relating to financing of higher education in the country and outlines a few suggestions.

The CABE Committee also recognised the limitations of non-governmental funding, and the vital importance of state financing of higher education to promote equity and growth. The Committee strongly urged Union and State governments to make a firm commitment to sustained funding of education and allocate 6 per cent of national income to education, 3 per cent for elementary education, 1.5 per cent for secondary education, 1 per cent for higher education and 0.5 per cent for technical education. It also suggested that norms be developed regarding the share of education, and different levels of education in the total government budgetary resources, to ensure a steady flow of funds.

A block grant system that is inelastic to the genuine needs of the system may not help in promoting development of higher education. A proper mix of block, maintenance, matching and development grants has to be evolved to promote excellence in research, teaching innovation, equity in the system, and reward efficiency.

Research has been a major casualty in recent years. The Committee suggested a significant increase in the allocation for research. It also stressed the importance of scholarships to promote equity in the current context of economic reforms.

An important recommendation is to design and launch an `Operation Blackboard' like programme for provision of basic facilities to all universities and colleges in the country, to ensure a minimum level of human resource (teachers) as well as basic infrastructure in all colleges and universities.

Resource-saving measures such as non-filling up of thousands of vacancies in universities and colleges could be highly counter productive in the long run and prove very costly.

The Committee recognised that the current rates of cost recovery in higher education are already fairly high in many universities, and the scope raising it any further is extremely limited. Endorsing the recommendation of the Dr Justice Punnayya Committee to raise resources through fees and other sources to the extent of about 20 per cent of the recurring requirements of the universities, the CABE Committee suggested that this 20 per cent be considered as a desirable upper level.

Revenue generation through student fees exceeding 20 per cent may seriously affect access to higher education. A sound method of cost recovery is encouraging graduates to take up employment in rural, tribal and remote areas for a minimum period.

The Committee also warned that excessive reliance on student loan programmes may be counter-productive in the long run, creating the impression that higher education is not a public good, but a highly individualised private advantage, as the responsibility of funding shifts from the state to households (through fees) and within families from parents to the children themselves (through loans).

There is need to regulate the growth of self-financing courses and distance education programmes, and also the unbridled growth of the private sector in higher education. Particularly, the proliferation of poor quality institutions of higher education needs to be stopped.

The Committee argued that the best and the only sustainable method of funding higher education is through progressive taxation system, that looks beyond income-tax, and not through user charges such as student fees. This has both theoretical and empirical advantages.

The recommendations made by the CABE Committee, some of which question the present policies, will go a long way in moulding public policy towards higher education. It is time for the government to act, rather than allow the process of `killing higher education', as feared by V. S. Mehta in the UGC Golden Jubilee lecture a couple of years ago.

(The author, a Senior Fellow and Head at the National Institute of Educational Planning and Administration, New Delhi, was Member-Secretary, CABE Committee on Financing Higher and Technical Education.)