ISLAMABAD: The Supreme Court in a majority verdict overturned on Wednesday its earlier decision of reducing tuition fees by 20 per cent by private schools, but ordered the institutes to re-calculate their fee by using as base the 2017 fee structure of Punjab and Sindh.

The calculations of the fees will be done in accordance with the Punjab Private Educational Institutions (Promotion and Regulation) (Amendment) Act 2017 and the Sindh Private Educational Institutions (Regulation and Control) Rules 2005.

On May 9, a three-judge bench hearing the private school fees case had reserved its ruling.

The bench was headed by Chief Justice Asif Saeed Khosa whereas Justice Ijaz-ul-Ahsan wrote the majority judgement. However, Justice Faisal Arab dissented from the judgement with his own reasoning.

The majority judgement, the details of which will come later, also ordered private schools not to recover any arrears on account of the reduction in fee by reason of the Dec 13, 2018 interim order reducing the fees by 20pc. “Thus all review petitions filed against the interim order by different private schools are disposed of,” the verdict said.

Institutes ordered to calculate fees on basis of 2017 fee structure of Punjab, Sindh

The judgement held that Rule 7-A and Rule 7(3) of the Punjab and Sindh laws, respectively, were in accordance with the constitution rules. Rule 7-A of the Punjab law allows 8pc increase in tuition fee in an academic year, whereas Rule 7 (3) of the Sindh law provides that the fee in an academic year can be increased by up to 5pc.

Justice Arab observed in his dissenting note that the parents of students belonging to middle class families had approached the apex court, not to challenge the tuition fee which the schools charged at the time of admissions, but what agitated them was periodical increases in tuition fees which proved to be an enormous burden on their purses.

Justice Arab recalled that over the years the country had witnessed a mushroom growth of educational institutes in the private sector. On account of lack of capable and efficient teachers and necessary facilities at public schools, many middle and lower middle class families, who a few decades ago used to send their children only to government schools, have lost faith in the public education system. These families in their desire for better education for their children started seeking getting their children admitted to private schools. This has resulted in phenomenal growth of private schools and now more than 50pc of students as per some statistics study in private schools where the level of education as compared to government schools is quite high.

Justice Arab observed that regardless of the cost, parents from middle and lower middle class families were sending their children to private schools even though it had impacted their budget severely. Much of the blame for such burden was attributable to the government which had failed in running the public education system successfully, he regretted.

Application of Rule 7(3) on private schools would certainly have the effect of subsidising the rich of the society, Justice Arab added.

He said the value of professional service in a particular field could not be measured and priced in the same manner as the value of an essential edible item such as milk and flour was measured while fixing its price under price control laws. He emphasised that the only object of the laws should be to check profiteering. But when the fee of any particular service was regulated in a manner that had the potential of gradually eating up legitimate margin of profit, it made businesses compromise on their quality lest they would run into losses, which in turn led to layoffs or their eventual closure, he argued.

For businesses such a regulation could prove to be worse than imposing heavy tax on income as at least in that eventuality the burden of tax would be conditional upon making profits, Justice Arab said.

Any regulation that acted as a discouragement in making investment in any trade, business or industry violated the freedom guaranteed under Article 18 of the Constitution, Justice Arab observed.

Published in Dawn, June 13th, 2019