Canada and India present several points of convergence and divergence in the expansion of higher education and its financing. Many of these arise out of federal and provincial jurisdictions. While education is a provincial subject in the Canadian Constitution, it is on the concurrent list in India. This has certain implications. While in India, the bulk of higher education takes place through state universities; in Canada, it is the provinces that are primarily responsible for higher education, and the federal government negotiates post-secondary education through areas of federal responsibility like national defence, Indian affairs, the territories, external affairs and the like. Unlike as in India, there is no national or federal government department to oversee aspects of higher education policy in Canada.
As Trowe has pointed out, there are three models of participation in higher education— elite, mass and universal[i]. All over the world, the system has moved from elite to universal. This is not only because of issues of equity. There is a more utilitarian motivation that has been articulated by both governmental and non-governmental organizations. A vast body of evidence supports a general public policy consensus that investment in advanced education yields high returns because of increased labour market participation that leads to greater productivity, economic development and innovation. The question is how to provide universal access to higher education. Can the government alone do it or is private funding essential? Of course, a compromise between the two is the public private participation model which also has to be adapted to different situations. In addition, what is the mix between the three? No definitive answers have emerged and higher education in both countries has moved in an evolutionary trajectory as it has responded to demand, democratic compulsions and the available state funding.
Canada
According to the Association of Universities and Colleges in Canada (AUCC), there are 95 public and private not-for-profit universities and university-degree level colleges in Canada today. Canada also has around 150 colleges distinguished by a range of titles such as Institute of Technology, Collège d’enseignement general et professional (CEGEP translated as College of General and Vocational Education) University College and Polytechnic. Since education is a provincial or territorial responsibility, these institutions vary in mandate, management models and policy frameworks. However, they share the primary functions of responding to the training needs of business, industry, public service sectors and the educational needs of vocationally oriented secondary school graduates. Historically, these institutions offered diplomas and certificates, not degrees. However, many have university transfer programmes and some are now offering degree programmes.
Participation rates have risen since the 1990s in Canada. Amongst the countries belonging to Organisation of Economic Cooperation and Development (OECD) countries, Canada has the highest level of educational attainment. Almost half of its population, amounting to about 46% aged between 25 to 64 has completed some kind of tertiary level education. The OECD average is 26%. Canada spends 2.4% of its GDP on higher education, which is the third highest amongst OECD countries after USA (2.9%) and South Korea (2.6%).
The economic downturn led to an increase in enrolment to the extent of 4.1% at the full time undergraduate level and 7.2% at the full time graduate level in the fall of 2009. The universities responded by making more opportunities available. As of 2009, there were close to 870,000 full time students studying at Canadian universities of which 734,000 were undergraduates and 136,000 graduate students. In addition, there were 279,000 part time students of which 232,000 were undergraduates and 47,000 at the graduate level. Further, there were 400,000 continuing education students. The number of students has steadily grown in the last fourteen years. In 2009, there were 300,000 more students than in 1996.
Canadian universities, therefore, serve over 1.5 million students and employ more than 42,000 as faculty. Nationally, Canadian universities are more than a $30 billion enterprise. Per student funding for teaching and research was $21,000 CAD in 2008-2009 whereas about $30 billion was spent overall on research. The research activities of Canadian universities are worth about $10 billion of which 55% – 60% is externally funded, the largest source being the federal government. The latter provides about $3 billion annually for direct and institutional cost of research infrastructure and salary.[ii]
Prior to World War II, higher education in Canada was more or less the exclusive domain of the privileged class. It prepared a few for elite professional and leadership roles in society. A system of mass participation emerged from 1950s onwards. It resulted in a massive expansion from 1960s to 1970s. Dale Kirby citing Dennison and Gallagher states: “This `golden age’ of development was driven by demographic factors such as the baby boom, changing labour market requirements and a greater acceptance of Human Capital Theory, that is, the understanding that there is a connection between one’s educational attainment and personal income, and that public investment in human capital contributes to economic growth.”[iii]
The most rapid expansion of higher education took place in the mid-fifties. Dr. E.F. Sheffield presented a short paper entitled “Canadian University and College Enrolment Projected to 1965”, at a symposium organized by National Conference of Canadian Universities (NCCU) in June 1955 in which he said that full time University enrolment would almost double between 1954-55 and 1964-65 increasing from 67,500 to 1,28,900/-[iv]. The system did not have the capacity to absorb so great an increase. University enrolment had increased by only 12% between 1944 and 1954. This reflected the importance of University education in a rapidly industrializing and urbanizing economy. The consequences of these enrolment increases predictably created pressures in two areas— physical facilities and academic staff.
In 1954-55, there were about 6000 full time university instructors in Canada and a doubling of enrolment implied doubling of the faculty in the next ten years in order to maintain the same student teacher ratio. It was realized that this would be expensive as would be the addition of required infrastructure. Where was the money to come from? In the 1920s, provincial grants had accounted for approximately 50% of all university income, tuition fees for 20% and private income for 30%. During the post world war depression, provincial grants were reduced and tuition fee had to be increased proportionately. [v]
Increased enrolment evoked a wide range of reactions in Canada from the caution advised by Toronto’s Sidney Smith who feared a decline in standards to “Larry” Mackenzie, President of U.B.C. who felt that universities should take in almost anyone who came. Overall, most Presidents of universities were in favour of growth. Consequently, operating grants for universities were doubled and in addition, 550 million were made available through Canada Council, half of which were for support of university capital construction.[vi]
By mid 1950s, the idea was firmly established that universities and university education represented an almost certain path to economic growth and individual prosperity. Universities began planning for new buildings, new programmes and much larger number of staff and students. The 1960s saw a virtual revolution in Canadian higher education based mainly on four propositions: massive physical expansion of major universities, growing autonomy for junior and affiliated colleges, transformation of denominational colleges into public universities, and community pressures for new institutions in cities currently then without a university or college. The Canadian provinces took the position that university capacity had to be continually expanded to meet the increasing student demand. The principal question that emerged was how large should a university become and at what cost. Several campuses were opened for each of the universities but they did not want to remain subservient to the existing universities, so they were gradually declared autonomous universities.[vii]
Since there is no one central policy of higher education in Canada, only broad trends can be indicated. For example, initially western provinces had resolved upon the policy of only one provincial university but geo-political realities necessitated the establishment of at least one additional institution affiliated with a university as a junior or satellite campus. Each of these satellite campuses chafed at their subordinate status and saw it as a policy of forced underdevelopment. This spurred them on to independent growth.[viii]
While the Canadian universities initially managed to accommodate the increased enrolment, additional faculty recruitment lagged behind by a year or two after which it expanded rapidly giving rise to concerns about the quality of faculty all of whom in the meanwhile had also been granted security of tenure. The increase in faculty was accompanied by increase in their salaries in order to attract talent. According to a survey of 17 universities carried out by the Dominion Bureau of Statistics, the median salary increase by nearly 40% in just three years between 1956-57 and 1959-60 naturally lead to a steep rise in university expenditure. The total operating cost doubled in five years from 76 million dollars to 143 million dollars.[ix] The principal source of funding for sustaining the expansion of the system had been federal funding although in Canada, education is strictly a provincial subject.
The value of federal per capita operating grant that had been doubled to $ 1.00 for 1956-57, increased to $1.50 for 1958-59 and again to $ 2.0 for 1962-63. The value of grants to the universities however, had not grown so dramatically. On a per student basis, the grants were worth $ 120 in 1951-52. This increased to $134 in 1952-53 but had dropped back gradually to $ 127 by 1955-56. The increase for 1956-57 raised the per student value to $ 221 but it dropped to $ 205 in 1957-58 before another increase brought it up to $ 297. By 1965-66, it had fallen back to $ 210. Thus, over the 15 year period from 1951-52 to 1965-66, the per capita value of the grants had increased four times, while the per student value had increased by a mere modest 43%.[x]
The National Research Council (NRC) was established in 1971 and was the principal sponsor of university-based research. It accounted for at least 60% of the total money spent on research. Provincial support began to increase substantially in the early years of 1960s but by 1965-66, it was still only 15% of the total. Around 1967, all federal support went to natural and related sciences. There was hardly any government support for research in the humanities and social sciences.
The Government responded to the dual challenge faced by it in the 60s of a rapidly expanding university system and increased unemployment in society. In November 1960, the National Housing Act was amended to permit the Central (now Canada) mortgage and Housing Corporation to make loans available to universities for the construction of student residences. This was not only a response to a real problem faced by universities but another consideration was to stimulate the construction industry and provide one method of coping with the high unemployment rate. The scheme provided mortgage loans of up to 90% of the cost of a project, with repayment over a period of up to 50 years. The major benefit to universities lay in the subsidized rates of interest. The total fund allocated for it was $ 50 million with the cost of each project limited by regulation to $ 7000 per student accommodated. In 1961, the overall limit was doubled and in 1964, it was raised to $ 150 million.
The federal government had been participating in a modest way in the support of university students since the Dominion-Provincial Student Aid Programme was introduced in 1939. All the provinces had developed student aid programmes and almost all of them contained provision for subsidized student loans. The Canada Student Loan programme was launched in July 1964. It provided individual loans of up to $ 1000 per year, with an overall maximum of $ 5000 for any one student. The money has actually be lent by chartered banks and credit unions, with the federal government both guaranteeing repayment and covering all interest charges until six months after a student’s graduation at the end of which the student had to assume responsibility for the repayment of the principal and interest over a ten year period. This was the Canadian way of helping students with the high tuition fees charged for post-secondary education.[xi]
Canadians also tried to cope with the expanding university system and convert it into an opportunity to expand employment by providing universal access to prepaid medical services. But this required a massive expansion in the training of health care professionals, including physicians. Several existing medical schools had to be expanded and new faculties of medicine established over the following ten years. There was also an addition of more university schools of nursing, expansion of the existing ones together with the creation of new dental schools.[xii]
The enrolment in Canadian universities kept rising resulting in a report on ‘Financing Higher Education in Canada: Report of a Commission to the Association of Universities and Colleges of Canada’ (1965). It began with the issue of enrolment that had been identified by Dr. E.F. Sheffield in 1955. Dr. Sheffield once again emphasized that the total full time enrolment, which had reached 178,200 in 1964-65, would almost double over the next six years to 340,400 in 1970-71. The rate of increase was expected to start declining after 1970-71. Even so, enrolment would continue to increase, reaching 461,000 by 1975-76. The Commission rejected any policy of restricting student access to higher education either by raising standards or by setting market driven quotas within the framework of a work force policy. However, it was aware that the increased cost of continued expansion would be even more dramatic than the projected increase in enrolment. Including operating and capital expenditures as well as student aid, the total costs would increase at almost twice the rate of enrolment reaching $ 1.7 billion by 1975-76, almost five times the $ 355 million spent in 1964-65. The Commission argued that only the Government was in a position to bear this expenditure and hence it would have to meet 70% of the operating cost, 80% of the capital cost and an even higher share of the student aid bill. At the same time, it recommended the increase in the operating grant from $2.00 per capita to $ 5.00 per capita and thereafter further by $11 each year. Student aid also needed to be expanded and a capital grant fund had to be established and funded at the rate of S5.00 per capita per year. Moreover, it was recommended that the federal support of research should be greatly expanded and all research grants and contracts should be accompanied by an additional 30% to cover the indirect or overhead costs.[xiii]
Another major study appeared in December 1965 in the form of the second annual review of the Economic Council of Canada. It made the most emphatic case possible in favour of increased expenditures on higher education. Based on studies of economic returns from investment in education, the Council estimated, “….the returns on the ‘human investment’ in high school and university education in Canada are in the range of 15 to 20% per year with slightly higher rates for an investment in a university education…” Moreover, the Council concluded, approximately one quarter of the real growth in personal income in Canada since 1911 could be attributed directly to increased levels of education. Hence, it called for, “rapid and substantial expansion of post-secondary education in all parts of Canada… to provide a ready opportunity to every qualified Canadian student so that financial obstacles will be eliminated as a barrier to higher education.”[xiv]
The era of rapid growth in provincial expenditure on university education ended in the 1960s. By the 1980s, a fair degree of stability had been achieved but in spite of it, while enrolment kept increasing, funding remained static. Universities preferred not to raise tuition fees to meet the rising costs. Resource mobilization through tuition fees had been the traditional complement to government grants and so had increased as a proportion of university revenues whenever government funding declined; for example in the Depression of the 1930s. As a matter of provincial public policy, however, this option was mostly precluded.
Universities resorted to borrowing but this could only be considered responsible if there was a realistic prospect either of increased revenue or of reduced expenditures in the near future. In the absence of this, deficit financing only increased the problem, because the cost of borrowed funds had to be added to the expenditure side in the subsequent years. There was also a political dimension to deficit financing. If a university was seeking to convince its provincial patron of the reality of underfunding, an operating deficit might be seen as telling evidence that the problem was serious. Hence, deficit financing was the first tactical response of most universities. Governments responded by resisting these tactics. Also, the universities realized that deficit financing could impair private fund raising as contributors would not want to donate to reduce debt.[xv]
Financial stringency led to favouring of selective cuts over general compression. Harold Shapiso, the then President of University of Michigan, said in 1982,
The idea that an institution should reallocate its limited resources to its areas of greatest merit rather than following a ‘mindless’ policy of ‘across-the board cuts’ enjoys greater favour at most faculty meetings.[xvi]
George Keller, in his ‘Academic Strategy: The Management Revolution in American Higher Education’;, advocated the strengthening of university management as a means to the radical restructuring of programmes and operations.[xvii]
Some efforts in this direction can be seen. For example, funding was dramatically reduced in British Columbia pushing its three universities to make dramatic choices. Several responses surfaced. The proposition ‘save jobs and let salaries slip’ found overwhelming support at the University of Victoria but no serious thought was given to the elimination or restructuring of programmes or to the termination of regular faculty. Some faculty positions were reduced by the process of attrition. Simon Fraser’s response was that lay-offs or terminations had to be avoided but significant programme changes were a must. A committee of faculty members submitted a ‘white paper’ on the future of Simon Fraser. As a result, new departments of computing science, communication, kinesiology and engineering were opened. The idea was that in spite of the economic crisis, these new faculties would attract research funds, and public support. Several language programmes were sought to be eliminated and others integrated into existing departmental resources. Thus, Simon Fraser implemented impressive restructuring. The University of British Columbia earned international notoriety by actually dismissing permanent faculty members. This led to the negotiating of generous severance arrangements.
Explicit policies and procedures governing lay-offs for financial reasons led to insecurity and as a consequence unionization and collective bargaining. Most collective agreements differed in detail but embodied two broad principles: the concept of academic redundancy was separated from financial exigency; and only the senates or their equivalents were empowered to approve faculty for academic and not financial reasons. If any faculty member had to be dismissed for financial reasons, the financial crisis was required to be confirmed by an independent audit that had to establish that all other reasonable steps to increase income and reduce non-essential expenditures had been taken.
One of the ways by which the financial outflow on salaries has always sought to be reduced is through the use of part time instructors, and this practice continues. Students are routinely employed on a part-time basis resulting in relatively inexpensive teaching assistance. It adds an essential component to the students’ financial support package and offers a measure of on the job professional training. Further, practitioners are used on a part time basis to complement full time faculty in professional programmes. For the practitioners, such teaching constitutes a recognition of their high professional standing. For the universities, it proves inexpensive and enables them to offer a large variety of programmes. Successful summer teaching is also done in this way. It is a method of a substitution of contract employees for tenured or tenured stream faculty members. This has also given rise to controversy from time to time as the aspiring tenured stream faculty members feel threatened.[xviii]
Universities also turned increasingly to the private sector as potential source of funds. With government grants and tuition fees both declining in dollar value per student taken at a constant rate, it offered perhaps, the only means of fiscal flexibility. Canadian universities showed great success in increasing private sector funding through fund-raising endeavours although they still fell short of the American endeavour. Annual giving, primarily from alumni also increased. Increased reliance on private sector also extended to research. Public private partnerships also cropped up. One such partnership was seen in the creation of `science parks’ that were a consortium of industrial research laboratories which operated in the private sector although land for them was assembled with the help of the Government. Several other schemes were launched for closer industry-university collaboration. These gave rise to concerns about implicit threats to academic freedom. John Panabaker, Chairman and Chief executive officer of the Mutual Life Assurance Company and a founding member of the Corporate-Higher Education Forum, argued that “universities have no real choice”,
Rightly or wrongly, society has come to see Universities as critically important to economic development, and expects to support universities more generously because of that perception. But that support will not make the universities’ lives easier. They must still redefine their roles in relation to their own sense of purpose and in relation to the needs and priorities of the larger society. That redefinition represents one of the greatest challenges Canadian universities have ever had to face[xix]
Davis, Alexender and MacDonald, in The Political Incorporation of Higher Education: A Problem for Democratic Theory suggested that the consequences could be very troublesome indeed:
Canadian governments are trying to influence the economy’s technological performance primarily through universities and public labs, not through initiatives aimed directly at the productive sector. This requires that the higher learning be co-opted…This is the political manifestation of a deeper development, the bureaucratic organization of knowledge. Under these fiscal and political pressures eroding, vast sums of money, hordes of people and almost all governments are dedicated to the realization of this prospect.[xx]
In the last decade, there have been further reforms because of policy guidelines in the late 1980s and early 1990s. British Columbia can once again be taken as an example as it has taken some radical steps to bring about reforms in organization, management, curriculum, access and finance. Out of these, two are especially significant. One is the Access for All policy of 1988 that required the government to improve space and equipment in the post-secondary sector and to enhance access to adult education, strengthen and increase the number of second year university equivalent courses in community colleges, establish a number of degree granting “university colleges” attached to a university, and enhance access to underserved community like the First Nations and those living in remote areas. It led to the creation of university colleges and colleges and institutes that were given the right to confer “applied” degrees. Thus, the non-university sector expanded vastly in response to the demand to produce better technical workforce so that Canadian business and industry could compete internationally without having to import skilled labour from other countries. The federal government made large financial resources available to provinces to construct and maintain an alternate system of post-secondary institutions, other than universities, to educate and train a workforce with the skills necessary to fill the industrial needs of the nation. These institutions were given different names in the various regions of Canada—Community Colleges, Technical Institutes, Colleges of Applied Arts and Technology and in Quebec, CEGEPs. Some of these institutions offered two-year programmes equivalent to the first two years of a university degree but the majority concentrated upon certificates and diploma offering skills to equip graduates for the workplace.[xxi]
However, in spite of the useful work done by these colleges, pressure continued on the governments to provide more seats in degree programmes as demand from prospective students grew and public interested intensified. The response from the provincial governments was threefold; one, established universities were funded to increase capacity; two, a number of new universities or university like institutions were established; and three, some non-university institutions in a few provinces were authorized to offer “applied” degree programmes. The latter was a clear departure from prior practice as upto then the word `university’ and `degree’ had been protected, and only universities had the right to grant degrees. British Columbia, Alberta and Ontario authorized the granting of `applied degrees’ by non-university tertiary institutions offering diplomas in applied areas like Business, Health and Applied Sciences.
The second step was the decision to not only allow but to even encourage the emergence of the private higher education sector to complement and compete with the public sector. The latter opened higher education to market forces. The public sector opposed this development because public universities feared that despite government assurances that no public funding would be diverted to private institutions, the private higher education sector would drain the much needed resources from public institutions. In spite of these reservations and protests, private higher education continues to grow.[xxii]
Private sector post-secondary education, both degree and non-degree granting is not entirely new in British Columbia (BC). The private vocational sector grew rapidly in the 1980s. It had been encouraged by the Federal Government policy for a “free market” in federal training programmes. This development was supported by the provincial government, which probably saw competition from the private sector as having an effect on controlling increasing unit costs in colleges and institutes. By 1990, there were over a thousand private vocational training institutes in BC. These institutes are small but their numbers have been steadily increasing and by 1999/2000 they accommodated 190,000 learners that were equivalent to approximately 60,000 full time enrolled students in terms of the public sector universities. These private for profit institutions target prospective students not served or inadequately served by the public post-secondary education system of British Columbia and also who are willing and able to pay the fees. When a new government came to power in 2001, it promised to revise the legal provisions for private sector education so as to enable it to expand in post-secondary education for both vocational training and study for degrees.
The Private Career Training Institutions Act (PCTIA) was passed in the legislative in the spring of 2003. This meant that the earlier Private Post-Secondary Education Commission (PPSEC), which was a government agency, created in 1992 by the Private Post-Secondary Education Act stood abolished. The earlier Act had made the registration of all private post-secondary institutions mandatory and thus provided some basic “consumer” protection to students. But the new Private Career Training Institution Agency (PCTIA) was not a public funded body. It was entirely financed and controlled by the private education industry and only “career related” training establishments came under it. This meant that several institutions like language schools and others were not covered under its regulation and hence their students were left unprotected.
In spite of a significant increase in public higher education since the 1990s, the demand still far outstripped the spaces available. Hence, apart from the Private Career Training Institutions Act, the legislature of British Columbia passed the Degree Authorization Act in 2003. This law enables private and out of province public institutions to both grant degrees legally in British Columbia, and to use the word “university” in front of their name. A Degree Quality Assessment Board was created with the mandate to review applications from the institutions wishing to award degrees. After review, the proposals have to be posted on the Ministry website. These are peer reviewed and if required by the Board, a report is also made by external experts. All this forms the basis for the Board to make recommendations to the Minister. Although the Degree Authorization Act does not apply to public post-secondary institutions, but the Ministry requires even their new degree programmes to be reviewed by the Board thus replacing the old Degree Programme Review Committee. Thus, points of convergence between the public and private sector have sought to be created.[xxiii]
India
The level of higher education in a country is determined by the size of its institutional capacity, which in turn, depends on the number of educational institutions, universities and colleges; the number of teachers, and the number of students. The Indian higher education sector is very large and complex.[xxiv] It consists primarily of different types of universities. As of September 2008, their numbers were as follows (Tables 1& 2)
Table 1: Institutional Capacity
Capacity Expansion in Higher Education
________________________________________________________________________
Institutional Capacity Indicator 1950 2008
Number of University Level Institutions,
including 11 private universities 25 431
Number of Colleges 700 20,677
Number of Teachers 15000 500,005
Number of Students Enrolled 100,000 11,600,012
________________________________________________________________________
Source: Cited by Sukhdeo Thorat, “Emerging Issues in Higher Education – Approach and Strategy in the 11th Plan
Table 2: Type of Universities
_______________________________________________________________________
Type September 2008
Central Universities 25
State Universities 230
Deemed Universities 113
National Importance (State) 5
National Importance (Center) 33
Private Universities 28
Total 434 _______________________________________________________________________
Source: Cited d by Sukhdeo Thorat, “Emerging Issues in Higher Education – Approach and Strategy in the 11th Plan
The Association of Indian Universities gives the figures for 2010 (Tables 3, 4, 5)
Table 3: Universities – Ownership-wise
| Financing | Universities (N) | Percentage |
| Public Funded | 379 | 73.03 |
| Self Financing | 140 | 26.97 |
| Total | 519 | 100 |
Source: AIU Database 2010
Table 4: Deemed Universities – Ownership-wise
| Financing | AIU Member | Total |
| Public Funded | 32 | 54 |
| Self Financing | 39 | 76 |
| Total | 71 | 130 |
Source: AIU Database 2010
Table 5: Universities/ Institutions and AIU Members
| University/Institutions | Total | Member Universities | Applied for Membership |
| State Universities | 253 | 195 | 45 |
| Deemed to be Universities | 130 | 92 | – |
| Central Universities | 40 | 32 | 08 |
| Institutions of National Importance | 38 | 13 | 01 |
| Private Universities | 58 | 17 | – |
| Associate Members | – | 3 | – |
| Total Universities | 519 | 352 | 54 |
Source: AIU Database 2010
As can been seen, the number of universities increased from 25 to about 434, between 1950 and 2008 colleges from 500 to 20,677, teachers from 15,000 to over 500,005 and student enrolment from 100,000 in 1950 to over 11,600,012. The expansion in institutional capacity in terms of number of universities/colleges and teachers has provided greater access to students to post-higher secondary education.
The access to higher education is measured in terms of Gross Enrolment Ratio (GER), which is the ratio of persons enrolled in higher education institutions to total population of the persons in age group of 18 to 23 years. The estimate of GER is generally based on the data collected by the Ministry of Human Resource Development (MHRD) or the University Grants Commission (UGC) from the educational institutions. However, through the studies before the Eleventh Five Year Plans the UGC, for the first time also estimated the GER based on National Sample Survey (NSS) data and the Population Census (PC) data. Table 6 presents the GER based on the Selected Education Statistics (SES) for 2006/7, NSS Data for 2004/5 and Population Census (PC) data for 2001.[xxv]
Table 6: Enrolment Ratio by alternative Sources
(figures in percentages)
| Alternative Sources | Gross Enrollment Ratio | Enrollment Rate of Eligible Student | ||
| All Graduate & above | Only Graduate | Only Graduate | All | |
| Selected Education Statistic (2006-07) | 10.80 | —– | —- | NA |
| National Sample Survey (2004-05)* | 12.59 | 10.84 | 1.75 | 56.61 |
| Population Census 2001 * | 13.6 | NA | NA | NA |
*Source – Estimate worked out by Ravi Srivastava and Sinha, 2008
The estimates based on SES indicate that the access to higher education measured in terms of gross enrolment ratio increased from 0.7% in 1950/51 to about 11% in 2006/7. The GER based on NSS data for 2004/5 is on higher side that is 12.59% (10.84% for graduate and 1.75% for diploma). The GER based on population census data for 2001 is also on the higher side, that is, 13.6 %. The differences arise because of the nature of reporting in NSS, SES and PC. The NSS is a household survey, which covers all public and private institutions as well as distance education. It also includes certificate and diploma holders. The Population Census estimate too is based on household survey and thus includes all institutions. Beside graduate and above, the data also includes certificate and diploma holders. The SES is generally confined to graduate and above in public institutions and private aided institutions. It also suffers from under reporting by the states and universities. The difference between the two sources is about 2 percentage points.
Universities and colleges vary in terms of their academic, administrative and financial arrangements. In India, only the Parliament or the state legislatures can establish universities. Those established by an act of Parliament are the central universities, and those set up by the state legislatures are state universities. Some institutions of higher education are granted `deemed-to-be-university’ status by the Central Government, and are commonly called deemed universities. A few institutions are established by the Parliament, and even state legislatures, as Institutions of National Importance. Universities, including deemed universities, and Institutions of National Importance are all degree-awarding institutions.
Though there is no clear demarcation, the colleges usually focus on undergraduate education while the universities impart post-graduate education and conduct research. In addition, there are many institutions like the India Institutes of Management (IIMs) that award diploma that are considered equal to degrees granted by the universities. Most universities and colleges offer multidisciplinary programmes. There are also some universities that are discipline-specific, such as agriculture, law, technology, language, medicine and so on. In addition, there are open universities that offer distance education programmes. While earlier most of the institutions of higher education were established and run by the government, now many of them are established and / or run by private trusts and societies.
India is on the threshold of vast expansion in the higher education sector. Having a student access of only 11% in higher education, it was realised that the country suffered from the dual problem of low enrolment and regional imbalance. A cross country comparison shows that sustained economic growth requires at least 20% – 25% enrolment in higher education. Table 7 gives a cross country comparison of enrolment.
Table 7: Enrolment Ratio – Cross-Country Comparison in 2000
_____________________________________________________________
Groups of Countries Gross Enrolment Ratio
Countries in Transition 36.5
Developed Countries 54.6
Developing Countries 11.3
World Average 23.2
_____________________________________________________________
Source: Cited by Sukhdeo Thorat, “Emerging Issues in Higher Education – Approach, Strategy and Action Plan in Higher Education in the 11th Plan
Hence, the Eleventh Plan aimed to increase the GER from 11% to 15% by 2012 and by another 6%, that is to 21%, by the end of 2017. In addition, the increased enrolment would have to come from regions which have been hitherto underserved, so as to reduce the inter-regional disparities. Duraiswamy has worked out that to increase the enrolment to 15%, the enrolment rate would have to grow at the rate of 8.9% per annum during the Eleventh Plan period while it grew only at the rate of 4.5% per annum during the Tenth Plan period.[xxvi] This means a net increase of 7 million students by 2012, the enrolment being about 14 million in 2006/7. To achieve this would require a huge expansion of capacity. It also has to be understood that the target of 5% increase in enrolment during a five-year period is an ambitious one considering that enrolment only increased to 10% in 2006-2007 from 1% in 1950.
To achieve its target of 15% enrolment by 2012, the Eleventh Plan has adopted a two-pronged strategy. One is to increase the number of universities and colleges, vocational and technical institutions. The second is to enhance the “intake capacity” of existing educational institutions. Following this, it is proposed that 30 new central universities are started, which includes setting up of 30 medical and engineering colleges in the central universities. In addition, a Tribal University is also to be set up. For enhanced access to technical education, 8 new Indian Institutes of Technology, 20 NIITs, 20 IITs, 31 ISERs, 7 IIMs and 2 SPAs have also been proposed. Further, 373 new colleges will be set up in districts with less than all India GERs with central assistance on a matching basis from the states. New Polytechnics will also be set up in un-served districts. There will be 500 new community polytechnics and 210 new community colleges.
The second strategy envisages expanding the intake capacity of existing institutions. This would mean a substantial increase in the regular development grants to central and state universities and colleges. Among other things, special grants would be disbursed to Central Universities and other Central institutions like the IIMs, IITs, NIITs, Medical and Engineering institutions to increase their intake capacities by 54%. Of this 54%, 27% are reserved for Other Backward Classes and the rest 27% for the General Category students.
Two studies were done before launching the Eleventh Plan. One is by Sudhanshu Bhushan entitled, ‘Financial Requirements in Higher Education during XI Plan Period’ and the other by Ravi S. Srivastava, ‘Financing Higher Education in India: Estimate for 15% Enrolment under the 11th Plan.’ As Srivastava points out, the plan has put behind more than a decade of relative neglect of higher education, to argue for a much higher public investment. He details three sources of finance for higher education while Sudhanshu Bhushan adds on one more. The four sources enumerated by Bhushan are:
- The State: The State can source finances through taxes, borrowing and deficit financing, but there are limits to which any government can raise resources for higher education.
- Parents: They may have to bear tuition and fees and other expenses such as books, transportation, boarding, private tutoring and others which can create difficulties.
- The student: He or she may obtain a loan based on the assumption that higher education yields a private return. This places an obligation upon the student to meet some cost of his studies in higher education. This source, given the changing nature of higher education, needs to be explored in developing countries.
- Philanthropy: This has high potential but it is not explored, as there is no mechanism to garner the funds. Alumni and corporate sectors are important potential sources. Almuni associations have supported part of infrastructure requirements and provided funds for activities like scholarship and seminars. Corporate sectors are a potential source that have not as yet fully exploited to support higher education.[xxvii]
There are some fault lines in the financial estimates made in these two studies enumerated by the scholars themselves. Perhaps the most important is limited information on the cost per student, the share of private financing; and the enrolment of students in private colleges. However, some estimates have been made to give some idea of the resources required for financing higher education. There could be a gap between the estimates and the actual requirement because of lack of information about the financial requirements to provide access and maintain the quality both in the government and state institutions. There are pressures that often lead to commercialization of higher education. The studies point to a burgeoning private sector but the absence of transparent government policies, regulatory mechanisms and disclosure requirements lead to other issues in which students can be exploited and there can be corruption in the system.
Private Institutions
Private Aided
While the State has been the dominant source of finance for higher education in post-independence India, non-governmental finance provided by religious endowments, charitable trusts and others was an important source of funding in the pre-independence period. It constituted about 12% of the total expenditure on education. In fact, the bulk of higher education in India was initiated and established by private philanthropy, which has dried up in post independence India. The private individual or organisations set up the institutions by investing in the capital costs and then got aid from the government for the major recurring expenditure after meeting the eligibility criteria. The bulk of recurring expenditure goes into the payment of salaries. These institutions are known as ‘private- aided’ institutions.
This, however, subjects the educational institution to the regulatory provisions and financial discipline of the funding entity, which may be the state government or the University Grants Commission (UGC). Several institutions complain that there have been problems with this model as the government grants have been declining but the strangle hold of regulation remains stifling to their growth. Since the post liberalisation phase of economic reforms, most state governments have virtually ceased to expand the list of government-aided institutions, which has led to an increase in the percentage of ‘self-financed’ or ‘private unaided institutions’. These institutions have now become an important source of finance for higher education and dominate some segments of technical and professional education like engineering, technology, medicine and para-medicine, management and others. Gradually, these are emerging in general education also. The private institutions which are not affiliated to universities are accredited to grant degrees/diplomas by the All India Councils, or by the respective universities to which they are affiliated. About 85 per cent of engineering colleges and 40 per cent of medical colleges are in the private unaided segment. Management and law are other areas where there is a very significant private presence.[xxviii]
Private Unaided
Private unaided but ‘recognized’ institutions are those which do not seek government funding but are expected to adhere to minimum standards. However, they are subject to fewer regulations with respect to fees, admissions and other areas. Both Srivastava and Bhushan point out that no firm estimates are available of the expenditure on financing education by private managements. The 52nd National Sample Survey results available for 1995-96, capture the initial impact of liberalization on the higher education sector. It is seen that the cost per student is higher in privately managed colleges, especially the unaided ones. Also, fees are much higher in professional courses than in general courses. This can be seen from the following table:
Table 8: Total Fee per Student, 1995-96 (Rs.)
______________________________________________________________________
General education General & Tech. education
________________________________________________________________________
Government / Local body 851 877
Private – aided 1374 1497
Private – unaided 3331 3495
All 1198 1276
______________________________________________________________________
Source: Computed from NSS, 52nd Round, unit record data.
In general, participation in higher education in general is concentrated among better-off households. The different cost implications of higher education with regard to state funded and private colleges further concentrates access to those who are well off. The 1995-96 survey cited by Srivastava shows that in government funded and managed institutions, the poorest, 40 per cent of the households, comprised only of 9.9 per cent students, but this percentage shrank to 5.8 per cent in private institutions.
Table 9: Percentage Students in Higher Education (By Type of Management)
________________________________________________________________________
MPCE Groups Government + Private aided Private un-aided Total Local body
________________________________________________________________________
Bottom 4 deciles 9.9 5.8 5.8 8.3
5th & 6th deciles 12.8 8.9 8.1 11.0
Top 4 deciles 77.3 85.4 86.1 80.7
________________________________________________________________________
Source: Computed from NSS, 52nd Round, unit record data.
The private for-profit or self-financing institutions have acquired a large and mostly undocumented presence in the higher education system. In professional and technical education, enrolment figures are not available and analysts rely on the number of recognized institutions or permitted intake.[xxix] However, even in general education, there is now a mushrooming of private, self-financing colleges. In one university in Kanpur, U.P., the number of such colleges outnumbered state assisted colleges in the ratio of 3:1!
As Kapur and Mehta point out, the growth of self-financing institutions has been most marked in Tamil Nadu, Andhra Pradesh, Karnataka, and Maharashtra. According to Anandkrishnan, in Tamil Nadu, self-financing colleges comprised of 56 per cent of arts and science colleges, and 96 per cent of engineering colleges in 2003-04.[xxx] The enrolment in these colleges accounts for the major part of the difference between the enrolments reported in the official statistical system and those captured by household surveys. According to the Central Advisory Board of Education (CABE) committee report, there is a sense in which the Indian higher education system is one of the most privatised in the world.
These institutions charge commercial fee rates, but do not adhere to any transparent admission procedures and in many cases, charge ‘capitation fees’. There have been attempts to regulate their fee structure at least for part of the admissions, and to systemize their admission procedures in a piecemeal fashion through court judgments and state or national level regulations. But the regulatory framework is extremely weak, and an attempt is being made to address some of the issues, but there has not yet been any great coherence.
Devesh Kapoor and Pratap Bhanu Mehta, along with Anandkrishnan point out some basic fault lines with regard to private providers of higher education. The basic difficulty is that invariably all such institutions are registered as non-profit institutions (trusts or societies) and are legally permitted to generate revenues which cover their costs and permit accumulation of surplus. Two judgments of the apex Supreme Court (the Unnikrishnan case in 1992, and T. M. Pai and others vs the State of Karnataka in 2002) have clarified that private managements have the right to establish educational institutions, subject to reasonable regulations in certain matters such as quality, malpractices, general admission procedures and others. The courts have also ruled that these institutions can be run as businesses but have to be established as charitable trusts or societies, with a non-profit motive. However, they are free to charge fees, which covers their operating costs and allow surplus to accrue that can be ploughed back for the development/expansion of the institutions. Thus technically, the only bar on the management of these institutions is that they cannot invest surplus in businesses outside the Trust. This, as Kapur and Mehta point out, leaves a very thin legal dividing line between philanthropic and for-profit investments in education. The government has also been barred from making any reservations in admission in purely private institutions in a subsequent court judgment in the Inamdar case, but this has led to the 93rd constitutional amendment introducing Article 15(5) to nullify the effects of this judgment and enable the government to enforce quotas on these institutions. This amendment, as has been pointed out earlier, has not been subjected to judicial scrutiny.
According to Anandakrishnan, only a quarter of such institutions genuinely function as public trusts or charitable societies, committed to educational excellence and conscious of their responsibility. The basic casualty is equity and access, both of which have to be provided through the public education system. The issue now is that a proper regulatory framework has to be instituted, which can safeguard the interests of all sections and permit these institutions to add to the capacity of the higher education sector.
Government Financing of Higher Education
Government funding finances an overwhelming proportion of expenditure in government institutions. In private aided institutions, government finances contribute a major part of the recurrent expenditure but the revenue accruing to these colleges is supposed to cover other types of expenditure. In private unaided colleges, their entire revenue goes towards the maintenance of these institutions. Thus, the total fee realised by private colleges is an approximation of the expenditure incurred by these entities.
In 1995-96, a total of Rs. 320 crores was realised as fees by the government institutions, and an equal amount by private-aided institutions, while Rs. 147 crores was realised by private unaided institutions. Thus, the private institutions in general education realised a total of Rs. 467 crores, equivalent to only 0.045 per cent of GDP. In the same year, the Central and state governments together spent Rs. 3871 crores. Thus, the expenditure by private managements was probably only around 10.8 per cent of public expenditure. However, firm estimates of the financial expenditure by private institutions in higher education are not available. These estimates need to be improved upon, and they are likely to have increased significantly in the last decade. In any case, it is obvious that the public sector dominates spending on higher education except, perhaps, in some segments of professional and/or technical education.
Of the two levels of government, the bulk of expenditure on education comes from the state governments, although the Centre shares a greater proportion of the expenditure on higher education. The government expenditure on education was the highest in the first two decades after independence and then it declined. Since the late 1980s, the Central government has slowly reversed its declining share in education expenditure, although it continues to be lower than in the first two decades. The share of the Central government in total expenditure on education declined from 24.7% during 1970-71 to 1980-81, to 21.1% during 1981-82 to 1991-92, and further to 20.3% during 1992-93 to 2003-04.
It is seen that the Central government spends a greater proportion of its education expenditure on higher education, which is consistent with its role as set out in the Constitution. The expenditure is divided into plan and non-plan categories. The latter represents committed spending of the government on account of recurrent heads, while the former represents fresh commitments towards the expansion of the capacity of the system, infrastructure and other related expenses.
There has been a steady decline in the percentage of plan spending to total spending by both Central and state governments — from 23.2% during 1970-71 to 1980-81, to 19.2% during 1981-82 to 1991-92 and further to 16.6% during 1992-93 to 2003-04. The share of plan expenditure on higher education to total plan expenditure has also been declining in each successive plan periods (NIEPA 2005a) as can be seen from the table below:
Table 10: State and Central expenditure on Higher Education
_____________________________________________________________________
State Centre Total
_______________________________________________________________________
1952-1961 9.3 20.7 10.6
1962-1971 8.9 40.3 11.8
1972-1981 11.5 47.9 14.0
1982-1992 12.2 36.2 14.2
1993-2004 11.4 23.3 12.7
*Source Estimate worked out by Ravi Srivastava 200, `Financing Higher Education in India-Estimate for 15% Enrolment under 11th Plan
Financial Requirements for Higher Education
The National Accreditation Council (NAC) grades universities and colleges but this has been voluntary. As these institutions offer themselves for assessment, there is a self-selection bias in grading. Efforts are now being made to make accreditation compulsory. A large number of these institutions do not come up to an average level of performance and the deficiencies are largely related to their sub-optimal size and infrastructure. In any case, the real per student public expenditure in India is low and has declined over recent decades. At the same time, there is a strongly felt need to increase enrolments and expand the coverage of higher education. This is also seen as closely linked to national development. The National Planning Commission and the UGC stressed the need to expand enrolment in higher education by five per cent during India’s Eleventh Five Year Plan period (2006-07 to 2011-12). The primary burden is on public expenditure, as private education cannot be expected to take care of social goals.
Both Srivastava and Bhushan have tried to estimate the financial requirement of increasing the enrolment by 5%.[xxxi] As has been pointed out earlier, there are disparities in enrolment data taken from Population Census (PC), Selected Educational Statistics (SES), and the National Sample Survey (NSS). The SES gives the most conservative estimate as it largely covers the government supported sector in education. The following table shows the enrolment in 2006-07 and projects it to 2011-2012 based on SES data.
Table 11: Projected Enrolment (in 000) based on SES with a Target of Five Per cent Increase in GER
| Year | Academic Year | Pop 18-23 | Total Higher Education | Total GER | Addl. Total Enrolment | Share of Tech in total Enr(%) | Tot Tech & Prof Ed | Tot Gen | Addl General Enrolment |
| Base Year | |||||||||
| 2006 | 2006-07 | 132243 | 12817 | 9.7 | 0.20 | 2418 | 10399 | ||
| 11 th Plan | |||||||||
| 2007 | 2007-08 | 135440 | 13950 | 10.3 | 1133 | 0.22 | 3069 | 10881 | 482 |
| 2008 | 2008-09 | 138318 | 15353 | 11.1 | 1403 | 0.24 | 3685 | 11669 | 787 |
| 2009 | 2009-10 | 141257 | 17092 | 12.1 | 1739 | 0.26 | 4444 | 12648 | 980 |
| 2010 | 2010-11 | 144259 | 19186 | 13.3 | 2094 | 0.28 | 5372 | 13814 | 1166 |
| 2011 | 2011-12 | 144287 | 21210 | 14.7 | 2024 | 0.30 | 6363 | 14847 | 1033 |
| 8393 | 4448 |
Source: Projections based on SES data; assuming a 5 percent increase in GER and an increase in share of technical and professional education from 20 to 30 percent.
It is obvious that the technical/ professional stream has grown much faster than the others responding to the demands of the changing economy but also indicating that the pattern of enrolment will change.
Private (unaided) education has grown at a rapid rate in the last several years. However, no firm estimates are available of the share of private in total enrolments. The primary source of data given by Srivastava is the NSS 52nd Round. According to it, in 1995-96 about 8 per cent of enrolment in higher education was in private unaided institutions. The share was higher in technical and professional education being 20 per cent in engineering, and 10 per cent in medicine.
Recurrent and non-recurrent expenditure per student.
In order to meet quality standards,normative requirements of recurrent expenditure are difficult to come by as are non-recurrent expenditure to cater to expansion of capacity. However, a high power committee called the Oversight Committee was set up by the central government to estimate the cost of increasing enrolment in existing institutions necessitated by the increase of quotas by 27% over and above the existing 22.5%. A subgroup of the committee (Group on Central Universities) has provided benchmarks based on the colleges of Delhi University.
The per student expenditures for Central Universities recommended by the Oversight Committee for Social Inclusion are Rs. 162,000 (non-recurring) and Rs. 121,000 (recurring, per year). However, Srivastava in his study revised the benchmarks of the committee and adopted a norm of Rs. 26,250 per student as recurring expenditure, and Rs. 40,000 per student as non-recurring expenditure. He also presented an alternative scenario if the government could not reach the above norm, but was able to raise the present per student expenditure in 1993-94 by 25 per cent in real terms to Rs 21,200 per student according to 2006-07 prices.
Calculations are based on the premise that the increased revenue expenditure will be available to about one-fifth of the enrolled students each year over the Plan period in the form of increased support to educational activities. This expenditure includes both Plan and non-Plan through both Centre and State. Similarly, it has been assumed that the total non-recurring expenditure will spread over five years in the following ratios: 10%, 15%, 25%, 25% and 25%.
Srivastava’s estimates based on norm-based requirements for recurring costs show that the total additional outlay required for achieving the enrolment targets will increase from almost Rs. 5,474 crores in the first year to Rs. 25,127 crores over the Plan period. As a percentage of GDP, the total outlay on higher education will increase from 0.65% to 1.06 %.
There are also estimates of additional outlay over the existing recurring costs. The total additional outlay required for achieving the enrolment targets will increase from about Rs 3,849 crores to Rs. 14,345 crores over the Plan period. The total additional outlay required over the 11th Plan period will be Rs 47,362 crores. As a percentage of GDP, the total outlay will increase from 0.59% to 0.79 %. The additional outlay will increase from 0.13 per cent in the first year of the Plan to 0.36 per cent in the final year.
In addition, the government has already committed itself to a considerable increase in investment in centrally funded institutions to make them socially inclusive. The likely costs to meet this requirement could be about Rs. 3260 crores or only about 0.02 per cent of GDP. The norm based estimate shows that the cost of higher education will exceed 1 % of GDP in the final year. These resources however, although desirable may not be immediately available.
How to raise resources
Assuming a rate of growth of GDP of about 7% annually, public expenditure would have to increase to more than 1% per cent of GDP, from its present level of about 0.40 per cent of GDP. Even if this increase takes place in a gradual manner, it would call for a considerable reprioritisation and fiscal effort on the part of both the centre and the states. If, however, as is being envisaged presently, the fiscal position of the centre and the states continues to improve, and national income increases at 9 per cent over the next five or ten year period, the relative fiscal effort required for to achieving the target in terms of real per student expenditure would be lower.
It has been suggested that just as the centre levies a cess on tax for financing elementary education, the centre and the states could consider levying such a tax to fund the needs of other education segments, including higher education, if the general tax revenue is not found to be sufficient. But a segment of opinion does not favour this, for example, the Committee of the Central Advisory Board of Education (CABE). In any case, new financing mechanisms may be needed by which both the centre and the states partake in the development and maintenance expenditure on higher education.
Bhushan points to several proposals that have been put up in the past which focus on increasing resources at the institutional level. These include:
(a) Increase in student fee;
(b) Starting of self-financing courses;
(c) More effective partnerships with industry and more consultancy assignments;
(d) Philanthropic donations;
(e) Utilization of land resources for commercial purposes was suggested recently by the National Knowledge Commission.
Proposals (c) and (d) are not particularly controversial, but these cannot be a substitute for existing resources. Further, the role of philanthropic funding in public and private institutions has declined in India since independence.
The real tuition fee per student has also been declining in government institutions. The CABE committee has assessed that the total fee formed about 15 per cent of the recurring cost of universities and colleges in the late 1980s, while tuition fee formed only 2-3 per cent of such costs. Internationally, fees constitute 15 per cent of recurring costs in many developing and developed countries, including public universities in the USA. Bhushan cites Carnoy to show that in China fee realisation now constitutes about 30 per cent of recurring cost. [xxxii]
In principle, the fee could be raised for better off students, while offering freeships and scholarships to the needy, i.e. while the better off students can pay for their education; mechanisms can be put in place to provide for a fee waiver and even funding to those who are in financial need. This is also a recommendation of some UGC committees and of the National Knowledge Commission. In courses where market rate of returns are perceived to be high, needy students could draw upon loans. In practice, however, given the size of India’s informal economy, assessing the financial status of a student’s family is likely to be difficult. Moreover, banks continue to be very conservative in granting student loans, insisting upon collateral and guarantees. The present experience in this respect too has not been encouraging, although reforms in the system could make the loan system more effective.
There is a proposal to set up a Higher Education Finance Corporation as an institutional mechanism to address investment needs in the higher education sector. The idea is to bring back and nurture the philanthropic tradition in education by providing loans at concessional rates of interest to agencies for establishing higher and vocational institutions in educationally backward areas. However, unless a more encouraging and friendly regulatory environment is established, philanthropy is not likely to become widespread.
Summary and Conclusion
The trajectories of the evolution of higher education in Canada and India show that while there is a commonality of issues in the changes taking place in higher education, different paths have been taken by the two countries perhaps because of the vast differences in their areas, population, socio-economic conditions, and the geo political realities. Besides, the constitutional legislative framework of the two countries is also different, resulting in different governance structures and financing arrangements.
For instance, the demand for higher education led to a rapid expansion in the number of universities in the 1950s and 60s and they were provided appropriate infrastructure. In India, the physical infrastructure at most universities has been woefully inadequate. The plan grant of the UGC is utilized for the development and expansion of physical facilities such as construction of new buildings, purchase of equipment for laboratories, expansion of library facilities and for creation of facilities to meet other academic and administrative needs. Since it is inadequate these are all under resourced and hence lead to a poor academic environment.
Further, while the satellite campuses in Canada gradually grew into full fledged universities, in India the move for autonomy of colleges has been by and large resisted by teachers. The Education committee 1964-66 had recommended the concept of autonomous colleges in order to provide academic freedom in areas of designing curricula, evolving new methods of teaching and learning, research and other academic activities like excursions, field work, framing of admission rules, prescribing courses of study and conduct examinations. Under the autonomous College Scheme of UGC, the college concerned is fully accountable for the content and quality of education it imparts. It sets its own examination papers and evaluates its students for the award of degrees, which are to be accepted by the parent university. Although financial assistance is provided by UGC to the autonomous colleges, the idea has not been accepted in large parts of the country.
Again, the fee structure has necessarily to be linked to the capacity of the majority of the students to pay. This obviously varies between Canada and India because of levels of economic development. Therefore, their positions have diverged. With the expansion of higher education in India and stagnant tuition fee since 1947, there has been a growing burden on the exchequer and has led to a discussion on cost recovery. An excellent overview is provided by J.B.G. Tilak who outlines the main arguments in India both in favour and against cost recovery from students.[xxxiii] Those who would wish to see education sustained by tuition fees from students insist that since public spending has necessarily to be constrained, the social demand for higher education cannot be met without significant levels of cost recovery. Otherwise, there is bound to be chronic under funding. Also subsidization of higher education often leads to subsidizing the rich rather than helping the poor. Thus, an increase in cost recovery will not lower the demand for higher education. Even if it does, it will reduce graduate unemployment and thus lead to a greater good. Access to greater resources will improve the quality of education and educational institutions and students would be willing to pay for better quality education.
Arguments against cost recovery are that it will restrict higher education to the elite whereas education is a social investment and must be available to all. Further, since fewer people would be able to afford it, the demand for higher education would get restricted whereas education is an absolute good and so must be encouraged even among those who are not fully aware of its benefits. In any case, tuition fee is not the only payment to be made and other costs like those of textbooks are hidden costs that make education more expensive than what the tuition fees would have us believe. Finally, the ability to pay has no direct correlation with the ability to learn.[xxxiv]
The case for cost recovery in developing countries is based on the premise that adequate governmental resources are not available. Is there a case for partial cost recovery? One method is through the introduction of student fees. Tilak argues that higher fees in higher education will lower the demand for secondary education.[xxxv] This, however, does not appear to be borne out by facts as the majority of countries charge fees for higher education – some very nominal amounts and in some cases, the fee is reasonably higher. The fee may also vary by discipline, region and socio-economic categories of student population. South Korea and Chile recover more than a quarter of their total public expenditure on higher education through fees. Further, public and private universities exist simultaneously and there are differences between how they finance their institutions. In some countries such as Venezuela, Colombia, Chile and South Korea, almost 80% of costs are recovered through tuition fees.
The question then arises, whether fees should be uniform. According to Tilak in India the proportion of students from lower and middle income groups combined is roughly half. Therefore, a case can be made out for a discriminatory fee structure.[xxxvi] Such a mechanism minimizes the perverse effects of public subsidization of higher education and can be based upon the cost of education, the ability to pay, the future lifetime earnings associated with a given type of education as suggested in the Unni Krishnan case. Thus, discriminatory pricing may be more efficient than a uniform one.
One method of compensating students for high fees is through student loans. But these may turn out bad loans at times. That is why while student loan schemes by banks for higher education are being gradually put in place, in India, they are not particularly successful in the sphere of non-professional education. This is because unlike in Canada, graduate unemployment in India is very high; skill development is low and syllabi in large measure so dysfunctional that they do not provide either intellectual leadership or vocational training.
It has been suggested that a cess for higher education can be levied. It can take the form of tax on the employee or on the student who must pay it after employment, or an education cess to be paid by all. The first, however, may act as a disincentive to the employer. The second may not be feasible considering the high rate of unemployment in India. The third may be feasible but the tax base in India is small. So, while both Canada and India recognize that the responsibility for higher education lies primarily with the government but if it has to be made accessible to all, there is no option but to spread the financial burden on both the students to some extent and on the private sector, whether on its own or in partnership with the government. Clearer policies with regard to the private sector as provider of higher education have emerged in Canada than in India. This will have to be remedied by the Indian policy makers.
(Kavita A. Sharma)
End Notes
[i] Dale Kirby, “Higher Education in Canada: New
Millennium, New Students, New Directions,”
www.inter- disciplinary.net/ati/education/ioe/ioe5/kirbyt%20paper.pdf
[ii] Quick Facts: Advocacy and Research: AUCC
http://www.qucc.ca/policy/quick-facts_e.html. See also Dale Kirby, “Higher Education in Canada: New
Millennium, New Students, New Directions,”
www.inter- disciplinary.net/ati/education/ioe/ioe5/kirbyt%20paper.pdf
[iii] J.D. Denmison and P.Gallagher, Canada’s Community Colleges: A Critical Analysis, University of
British Columbia Press, 1986, pp 11-16. Cited by Dale Kirby, “Higher Education in Canada: New
Millennium, New Students, New Directions.”
[iv] David M. Cameron, More Than an Academic Question: Universities, Government and Public Policy in
Canada, Nova Scotia: The Institute for Research on Public Policy, 1991, pp.3-4.
[v] Ibid., p.4
[vi] Ibid., pp.62-63
[vii] Ibid., p.92
[viii] Ibid., pp. 72-73
[ix] Ibid., pp. 81-84
[x] Ibid., pp. 64-66
[xi] Ibid., pp. 121-123
[xii] Ibid., pp. 123-124
[xiii] Ibid., pp. 125-126
[xiv] Ibid., p 126
[xv] Ibid., pp. 403-406
[xvi] Ibid., pp. 413
[xvii] Ibid
[xviii] Ibid pp. 407-408
[xix] Ibid., p.427
[xx] Ibid.,
[xxi] John D. Dennison, and Hans G. Schuetze, “Extending Access, Choice and the Reign of the Market,”
The Canadian Journal of Higher Education, Vol. XXXIV, No.3,(2004) pp. 13-38
[xxii] Ibid., See also Hans G. Schuetze and William Bruneau, “Less State, More Market: University Reform
in Canada and Abroad,” The Canadian Journal of Higher Education, Vol. XXXIV, No.3, (2004), pp. 1-
- Also, Paul J. Madgett and Charles Blanger, “Canada and the United Kingdom: Higher Education
Policy and the Knowledge Economy,” Http://hep.oise.utoront.ca/index.php/help/article/view/672/1545.
[xxiii] John D, Dennison and Hans G. Schuetze, “Extending Access, Choice and the Reign of the Market.”
The Canadian Journal of Higher Education, Vol. XXXIV, No.3 (2004), pp. 13-38.
[xxiv] Eleven Studies were undertaken by the University Grants commission India before the XI Five Year
Plan. These were put together under, Higher Education in India: Issues Related to Expansion,
Inclusiveness, Quality and Finance, UGC: New Delhi, 2008. Henceforth referred to as UGC Study.
Within it, see Sukhdeo Thorat, “Emerging Issues in Higher Education – Approach and Strategy of 11th
Plan.
[xxv] Ravi S. Shrivastava and Sachidanand Sinha, “Inter-Social Groups Disparities in Access to Higher
Education,” UGC Study.
[xxvi] P. Duraiswamy, “Enrolment Forecast of Higher Education for Inclusive Growth in the 11th Plan,”
UGC Study.
[xxvii] Sudhanshu Bhushan, “Financial Requirements in Higher Education during XI Plan Period.” UGC
Study. Also, Ravi S. Shrivastava, “Financing Higher Education in India: estimate for 15% Enrolment
under the 11th Plan,” UGC Study.
[xxviii] Ravi S. Shrivastava, “Financing Higher Education in India,” UGC Study.
[xxix] Both Ravi Shrivastava and Sudhanshu Bhushan rely on D. Kapur and P.B. Mehta, “India Higher
Education Reform: From Half-Baked Socialism to Half Baked Capitalism,” Working Paper No. 108,
Centre for International Development, Harvard University, September. Also, NIEPA (2000),
University Finances in India, New Delhi (mimes) and, NIEPA (2005a), Report of the CABE Committee
on Financing of Higher and Technical Education, Central Advisory Board of Education, New Delhi,
June.
[xxx] M. Anandkrishnan (2006), “Privatization of Higher Education: Opportunities and Anomalies,”
presented at National Seminar on Privatization and Commercialization of Higher Education, New
Delhi 2nd May. Cited by Ravi Shrivastva.
[xxxi] This discussion is based on Ravi Shrivastava, “Financing Higher Education in India” UGC Study; and
Sudhanshu Bhushan, “Financial Requirements in Higher Education” UGC Study.
[xxxii] M. Carnoy (2006), “Higher Education and Economic Development: India, China and the 21st
Century,” presented at Pan Asia Conference: Focus on Economic Challenges, Stanford Centre for
International Development, Stanford (May 31- June 3). Cited by Ravi Shrivastava, “Financing
Higher Education” UGC Study.
[xxxiii] J.B.G. Tilak, “Lesson for Cost Recovery in Education,” Marketizing Education and Health in
Developing Countries Collough ed. Oxford: Clarendon Press, 1997, pp 64-65.
[xxxiv] Ibid., pp. 65-66
[xxxv] Ibid., pp. 70-73
[xxxvi] Ibid., p. 76