JNU controversy exposes how public-funded universities are subsidising the rich along with the poor

By: |
Published: November 18, 2019 3:21:27 AM

In the 1950s and 1960s, when the government focused heavily on education, it was in keeping with the socialist ethos of the day and the fact that it needed more human capital to realise its ambitious industrialisation plans.

JNU, JNU controversy, public funded university, Delhi University, DU, Ambedkar University Delhi, AUD, Universities Grants Commission, UGCJNU is overly subsidised, with a unit cost of Rs 5.83 lakh including salaries.

Earlier this week, when the Jawaharlal Nehru University released a new hostel manual indicating a revision of fees after 19 years, students took to the streets against the administration’s move. The hikes that are to be implemented from the next academic session will drastically increase the costs for students. While the students were, at present, paying Rs 10 per month for a shared hostel room, and Rs 20 for a single-occupancy hostel room, after the hike, they would have to pay Rs 300 and Rs 600, respectively. Although the university has rolled back part of the fee hikes for Below Poverty Line students, the bone of contention is the Rs 1,700 service charge that students have been asked to pay for utilities like water, gas and electricity. Against the JNU Student Union’s claim that 40% of the university’s students come from economically weak backgrounds, the students’ fury might seem justified. But, JNU’s hikes must be read with the fact that Delhi University (DU) and Ambedkar University Delhi (AUD) charge anywhere between Rs 2,500-3,000 for hostel accommodation even after subsidising the costs.

Some may argue the facilities at JNU are not comparable with those that DU or AUD offer. But, how are authorities to improve infrastructure if they are simply not allowed to narrow the deficit between academic receipts and actual costs—let alone raise funds—through fee hikes?

JNU, JNU controversy, public funded university, Delhi University, DU, Ambedkar University Delhi, AUD, Universities Grants Commission, UGC

In the 1950s and 1960s, when the government focused heavily on education, it was in keeping with the socialist ethos of the day and the fact that it needed more human capital to realise its ambitious industrialisation plans. While the move entailed even private institutes becoming dependent on a grant-in-aid system, it also ensured that education was within reach of the masses. There is still a need for subsidised education, but the lop-sided approach has ensured that colleges come to depend more on government grants and aid than building their own resources. Student fees account for only 2-3% of funds that most universities in India require.

An analysis of data from self-study reports submitted by different institutions to the National Assessment and Accreditation Council (NAAC) indicates a massive gap between fees and universities’ annual expenditure on students. Most of the funds thus comes from government grants, apportioned by the Universities Grants Commission (see graphic). In Delhi University, data shows that for colleges like Hindu, Hansraj and Miranda House, fees accounted for one-tenth to one-fifth of total expenditure. So, while the unit cost of education—NAAC defines this as the total recurring annual expenditure per student—was Rs 75,769 including the salary component in Hindu College in 2015-16, students were paying one-fifth of this. Similarly, in Miranda House, unit costs were Rs 1,01,592, while students paid only 14%. For Delhi University as a whole, accounts for the same year, show that academic receipts at Rs 103 crore were just 4% of the total expenditure of Rs 2,352 crore. In the case of AUD, the self-study report from 2012-13 shows that unit cost was Rs 1,75,000 including salaries, whereas the cost to students was Rs 32,000.

On the other hand, JNU is overly subsidised, with a unit cost of Rs 5.83 lakh including salaries. JNU charges a Masters/Bachelors student just Rs 450 as annual academic charges (excluding hostel and mess) and an engineering student just over Rs 1 lakh. BITS Pilani, a top-ranked private engineering institute, charges a student over Rs 2,00,000 per semester and has a unit cost of Rs 2.21 lakh for its Indian campus. Even the unit cost of its Dubai campus, at Rs 4.87 lakh, was less than JNU. Fees in 2016-17 accounted for 1% of the total annual expenditure incurred by JNU.

Although IIMs do not figure in the NAAC gradings, a look at the accounts for IIM-Ahmedabad shows that, for the year 2017-18, academic receipts, at Rs 209 crore, were 30% more than the total expenditure for the institute. Not that the IIM-A should be the benchmark, but given its record, it shows that the institute performs well—not just in terms of placement salaries, but also in terms of research output.
It is true that even the best non-profit universities in the US—the likes of Harvard and Stanford—subsidise education. It can be no one’s case that the actual costs of education should be recovered from students via fees, either. But, Indian universities can learn from their Western peers’ example when it comes to raising funds to reduce dependence on government grants. In India, Ashoka University has been able to attract top talent by cross-subsidising education based linking of individual student’s fees to parents’ income. A Delhi University or a JNU can do the same. While JNU does this to a certain level—it does impose a higher cost on students whose parents earn more than Rs 5,00,000—it is not sufficient. Take the case of Stanford. A CNBC article highlights that even though total cost at Stanford was $74,750, students from families earning less than $65,000 annually paid $4,638 or 6% of the value. On the other end of the spectrum, for students from families earning more than $245,000 annually, the subsidy was 24%, and only 44% from such families availed this, whereas others paid the full amount. In contrast, a student studying in Delhi University pays the same amount for hostel and tuition as those from economically weaker classes.

India needs better-funded universities to build world-class institutions. Till it doesn’t give up on its one-fee-for-all approach, it won’t be able to achieve that.

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Next Stories
1Delhi pollution casts a pall on the Panasonic Open in Gurugram
2Ayodhya verdict: Now, VHP should say sorry for the destruction of Babri mosque
3Aatish Taseer’s criticism of PM Modi was best ignored