SC resets private schools fees to Jan 2017 rates; subjects increases to regulatory approval

Published September 14, 2019
For the time being, private schools will charge the same monthly fee as was being done in January 2017, according to the Supreme Court’s judgement in a case related to fee structures of private educational institutions. — AFP/File
For the time being, private schools will charge the same monthly fee as was being done in January 2017, according to the Supreme Court’s judgement in a case related to fee structures of private educational institutions. — AFP/File

ISLAMABAD: Private schools have been directed by the Supreme Court to revert to the same monthly fee as was being charged in January 2017 till they receive regulatory approval to increase their fee by the maximum limit allowed by the apex court.

In its detailed judgement on a case relating to fees charged by private educational institutions, issued here on Friday, the apex court struck down any increase in the fee structures of private schools done after January 2017.

It will be deemed as if there has been no increase in the fee since 2017 and that it is frozen at the rate prevailing in January 2017, the verdict read.

The freeze will hold till the private schools get regulatory approval for increasing their fee under existing rules and conditions, and subject to a maximum limit of 5 per cent.

The verdict says annual increase in fees will be permitted only under the law/rules/regulations till 2019 and onwards. The process of recalculation will be supervised by regulators and only the fee structures approved by them will be allowed.

The SC bench which decided the case was headed by Chief Justice of Pakistan Asif Saeed Khosa. Justice Ijaz-ul-Ahsan authored the verdict and Justice Faisal Arab wrote an additional note.

Justice Ahsan expressed concern over reports that private schools had excessively increased fees since 2017 and ordered that the fees would be recalculated in accordance with provisions of laws of Punjab and Sindh.

Strikes down any increase in fee structures since that time

The calculation of school fees in Punjab and Sindh 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, respectively.

The verdict says since the beginning of June 2017, a number of private educational institutions have been increasing their fees exorbitantly in violation of relevant laws/rules. But the regulatory authorities have turned a blind eye to the plight of students and their parents who have been hard-pressed to meet the ever increasing demands of private educational institutions and are being faced with the prospect of either paying the increased fees by hook or by crook or to look for alternative options which in the field of education are extremely limited.

Considering this situation, Justice Ahsan said, the apex court through an interim order of Dec 30, 2018 had ordered a 20 per cent cut in the fee structures of those educational institutions which were charging fees in excess of Rs5,000 per month.

“We have reason to believe that the said order was duly complied with,” the judgement says, adding the amount equivalent to 20pc of fees (reduced under the court’s order) or any other amount will not be recovered as arrears.

Any excess amount in fees found to have been charged will be adjusted in the future fee, the verdict says, adding the regulators will closely monitor fees being charged by private schools to ensure strict compliance with relevant laws and rules/regulations.

The court also ordered to set up complaint cells to deal with complaints regarding increase in fees.

The judgement explains that the private educational services industry constitutes ‘business’ under Article 18 of the constitution which simply takes it like any commercial activity for provision of services.

However, it says, as per the ordinary meaning of ‘trade’ which is basically buying and selling of goods and services, the private educational services industry constitutes ‘trade’ and, therefore, can be subjected to regulation by a licensing system.

Though people have a right to conduct business of educational services in order to earn money but such a right is not absolute or unfettered, the verdict says. By virtue of a licensing system, the state is empowered to regulate the exercise of such a right and hence, can impose certain restrictions, which includes the power to regulate and control prices.

Such power has to be exercised fairly and reasonably and is justicable on the touchstone of being unreasonable or arbitrary, the onus being on the person alleging un-reasonability or arbitrariness, the judgement says.

It explains that the laws of both Punjab and Sindh aim at giving government control over unrecognised private educational institutions by providing a system of registration and to regulate various matters relating to private educational institutions including, but not limited to, school fees and staff salaries by the respective government or registering authorities.

It appeared that the legislature thought that the supervision of private educational institutions was necessary and in public interest, particularly from the perspective of students and their parents considering the tendency of unregulated, unpredicted and exorbitant increases in school fees, hence the caps; and from the perspective of teachers when it came to their salaries, the judgment said.

Though the court is cognizant of the hard work that many of school owners have done, we do not find restrictions of capping the fees in question to be arbitrary or excessive in nature.

Additional note

Meanwhile, Justice Faisal Arab in the additional note observed that the parents of students coming from the entire range of middle class families had approached the apex courts, not to challenge the tuition fee which the schools charged at the time of taking admissions but what agitated them was the periodical increases made in the tuition fees which proved to be an enormous burden on their budgets.

Hence, a substantial raise in fees in comparison to the existing fees stirred agitation amongst the parents who invoked Rule 7(3) of the Sindh law and Section 7A of the Punjab law to seek reduction in the fee structures.

Justice Arab recalled that in the last 30 years the country witnessed a mushroom growth of educational institutions in the private sector as dependence of parents for educating their children in such institutions has grown phenomenally.

This dependence is on account of pathetic quality of education in the government education system as many government schools do not have proper buildings. Where there was once a proper running school building now it is in shambles and most of the schools are without teachers and where there are any, they don’t take classes, remain mostly absent yet get paid from the exchequer.

Published in Dawn, September 14th, 2019

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