July 09, 2009

Understanding of Fee Regulatory Committee report by HSPA

DPaS is the founding member of Hyderabad Schools’ Parents Association (HSPA) which is working almost round the clock on the aspect of irrational fee hikes by various schools across twin cities. Today HSPA has support of parents from over 20 plus schools like Meridian, DPS, Princess Esin, Glendale, Chirec, CAL, Niraj, Sunflower etc to name a few.

This communication is intended to clarify & clear all doubts that most parents from across schools raised during various forums including the confusion created by media. This is a summary of general understanding of HSPA members after various meetings with authorities concerned with this report (political & bureaucratic) in last few days. This is intended for information to the members only & not for general circulation & we at the most can clarify on what has been written & doesn’t necessarily be an exact replica of the report submitted (which at present is not for public circulation) to the Government of AP.

Excerpts of the Recommendation:
The expert Fee Regulatory Committee, headed by Luv Agarwal, Commissioner for Intermediate/ Collegiate Education, Navin Mittal, Hyderabad Collector, B Mallamma, Joint Secretary (Education), N Ramana Rao, Additional Secretary (law) and Narayana Reddy, Principal of a corporate school; have given the following recommendations with respect to the fee that can be charged by private schools across Andhra Pradesh:

1. Private School fee has been divided into three basic parts as:
a) One time fee (registration, admission, security caution deposit)
b) Annual recurring academic/ tuition fee and
c) Optional annual user fee.

2. One time Fee: The committee noted that several schools were collecting an amounts ranging from Rs 5,000 to Rs 30,000 just for the admission application form. The committee said that since this is only administrative task the application cost should be less than Rs 100. Admission fee should not be more than Rs 500, as this entail only minor administrative cost. Schools should not collect a caution deposit of more than Rs 5,000 and it has to be refundable, the committee added.

3. Annually recurring academic/ tuition fee: No private schools in the state should be allowed to collect more than Rs 24,000 per annum for students up to Class V and Rs 30,000 per annum for students from Class VI to XII. These are upper ceilings and a specific fee for a school is applicable based on the infrastructure, facilities, education pattern, experience of teachers and more importantly the income/expenditure statement etc. The fee depending on these parameters can be anywhere between Rs 2,000/- - Rs 30,000/- per annum. This should be also read in conjunction with point 11, 13, 14 where School governing Council and PTA has lot of control to see a regulated fee hike, if necessary.

4. All cost heads like excursion, sport, activities, computer etc should be a part of this academic / tuition fee. Seeing the accounts of even several hi-end corporate schools, the committee found out that even in most expensive schools, the genuine monthly education expenses are not more than Rs 1000 – Rs 1600 per month per child. School should also consider all future growth, expansion plan and add all such related capital expenditures as a part of school annual operating cost. These developmental costs can’t be more than 15% of the overall school operating cost for basic education and should be a part of the above mentioned tuition fee.

5. This fee should be collected in phases/ terms.

6. In rural areas, this upper ceiling of tuition fee has been fixed at Rs 15,000 per annum for all classes I-XII.

7. Optional Annual User fee: To be collected in phases/ terms, this includes fee for heads like transport, food, books, uniform and hostel. They are kept outside of the upper ceiling for Annual tuition fee. They are expected to be provided by all schools, however they are termed as a “user” fee, as the student/ parents can use these services, if they find suitable/ logical. These services should be optional and should operate at no-profit basis.

8. For all books and Stationary, school should publish the address details of 3 shops, where these are available openly and competitively for parents’ comfort. School can arrange to have a counter for sell of books and stationery's in the school campus, only if they are being sold at a discount on the MRP. Same applies for Uniform.

9. The User fee would be decided based on usage i.e. transportation fee should be charged based on the distance between the house & school and not by the management’s whims and fancies.

10. Fee revision Process: The Annually recurring academic/ tuition fee structure can be revised only once in 3 years.

11. Schools should also give official fee receipts in the name of the school only.

12. Governance Structure: The panel recommended Constitution of district-level fee regulatory committees. If the school management wants to increase the fee, it will have to seek the approval of this fee regulatory authority with collector, joint collector, DEO, a senior finance resource (who can audit school balance sheets) and other officials as members.

13. The committee has reiterated that as defined in existing GO – MS1, there should be a Governing council in every school that includes representatives from parents, teachers and management. As already defined in existing GO– MS1, an active Parent Teacher Association (PTA) should be constituted for every school and it should be consulted on the fee hike as a first step. PTA should review and discuss hiked fee based on income and expense statement. The fee hike proposed can’t be hiked more than the increase in Consumer Price Index as inflation can still be negative, while the CPI may be positive. Even considering CPI, this increase can’t be more than 15% over previous fee, on a maximum side.

14. Optional Annual user fee structure also needs to follow the review with PTA and School Governing council and a need based increase based on income and expense statement.

15. Based on PTA’s positive acceptance, the Governing council, as mentioned above, should approach the district fee regulatory authority with all the accounts on income and expenditure based on which district fee regulatory authority should approve the hike. Once approved, this fee will remain applicable for 3 years and can’t be changed in any circumstances.

16. If PTA does not agree with the recommended level of hike (as the income and expense statement may not support the necessary hike), then the PTA can raise the complaint with the district-level fee regulatory committee in this context.

17. Aggrieved parents are also entitled to approach the fee regulatory committee, if they have any grievances pertaining to fees.

18. Time-table: The Governing councils should approach the fee regulatory authority by September and a decision will be taken by the authority by December every year. The hiked fee will come into force during the next academic year. For an example, the Governing councils should approach the district fee regulatory authority by September 2009 and a decision should be taken by the district fee regulatory authority by December 2009. The hiked fee will come into force during the next academic year April 2010 till March 2011 and will remain applicable till March 2013. In Sept 2012, the School Governing Council can start the process again, if a hike is needed.

19. Enforcement: In case of district fee regulatory committee finds any anomaly in implementing these suggestions, the affiliation of school can be terminated. In case of CBSE/ IGCSE affiliated school, the NOC issued by District Education department can be withheld.

20. Applicability of these recommendations in current year’s context: The expert panel recommended that the fee prescribed for the last academic year (2008-09) would stand good for this year (2009-10). All private schools should roll back the hiked fee for this year. In case parents have already paid the hiked fee, the extra amount will have to be adjusted in the coming academic year.

21. General: Schools will have do away with names such as “concept schools”, “techno schools” etc. They should be named as primary, upper primary, high schools and public schools.

All these recommendations are in tune with the AP Regulation of Education and Prohibition of Capitation Fee Act 1983. If the government accepts the recommendations which are based on Section 15 read with Section 37 of the AP Educational Institutions Regulation of Admission and Prohibition of Capitation Fee, 1983, the private schools will have to implement it.