Why Capitation Fee?

ng population, neither the Govt. nor the Christian management could cope with the same. The vacuum was filled up by the individuals masquerading as charitable societies and institutions, solely with the intention to make profit. Karnataka happened to take the lead in that. Kerala with the highest literacy rate and Tamilnadu following, supplied the students to such mushrooming colleges.

For Kerala, with its red tag, private professional colleges were an anathema. Many of such colleges that had mushroomed in Karnataka in a short span of time, evolved into first class institutions with the huge capitation fee they could collect mostly from students from Kerala. Kerala happened to be the major contributor because of the sizeable N.R.I population. Roughly from 1980 to 2000, both the 'Left' and the 'Right' that governed the State did not allow a single private institution to come up. The very word ‘private’ was a taboo. It was then thought that Co-operatives could be permitted. And finally came up self-financing Colleges by even private individuals. It should be said to the credit of the Congress that it at last realized the folly of keeping the door of professional education shut for private investment. But the agony is that it lacked the courage to openly state what it felt strongly. That resulted in its venturing to choke into suffocation those who dared to invest in the field, sensing a goldmine. Populist legislation where the treasury and opposition unanimously vote for was the end product of the highest order of hypocrisy and self deceit.

The legislations provided for all sorts of conceivable and inconceivable quotas and restrictions which made impossible the functioning of institutions. The self financing Colleges were destined to bleed to death. Therefore, they went to the Courts in challenge. Thus, came the landmark judgment of an eleven judge Constitutional Bench of the Supreme Court in T.M.A. Pai case. That was a major deviation from the conventional notions about the “Education Industry”. We Indians practice a whole deal of hypocrisy. Publicly, we swear by what we privately denounce to the core of our heart. Education was not still accepted as an 'industry' or 'business' in T.M.A Pai case. One could find the Supreme Court at fault the least for that. None of the Self Financing Colleges, even the unaided, had the courage to plead so. It was indeed only because of the wisdom of the Supreme Court; “Education” was accepted at least as an ‘Occupation’. The Supreme Court further said in T.M.A. Pai that the Governmental-interference should be minimal and that too only in prescribing standards. But at the same time the Supreme Court put a laid of a definite 'no' to capitation Fee and profiteering. The Court even gave the reasons for a ban on Capitation Fee. Doctors who had secured admission into Medical Colleges paying Rs.30 to 50 lakhs as capitation fee on coming out of the College would try to recoup the same by unethical means.

Nobody can question the rationale behind such an assumption. However, unfortunately, none including the Supreme Court considered why the “capitation fee” does exist? And why no legislations can absolutely assure that it does not exist? Capitation fee is bad. Nay, it is a horrendous crime. But, can any law prevent it unless the ground realities because of which it exists are not addressed? Namely, the imbalance of demand and supply. Everybody knows for certain that capitation fees from 25 to 50 lakhs are taken by self financing Colleges both Christian and Muslim, aided and unaided, minority and majority. The NRI’s are the ones who are the worst victims of such highway robbery. Then, what is the Answer? Today, smuggling is non-existent. COFEPOSA, FERA/FEMA and SAFEMA are statutes in the cold storage. If at all there is smuggling, that is in high speed diesel.

Opening up of economy by late Narasimha Rao, who died in ignominy, but is sure to be accepted as the father of modern India in less than 30 years ahead, made smuggling no longer a lucrative economic activity. High speed diesel is high in demand in smuggling, because international price of diesel is less than half of domestic price thanks to heavy duty on petroleum products. Therefore, I dare to suggest the unthinkable. Don’t stop at recognizing Education as an Occupation. Go further. Accept it as an industry or business, where profiteering is not only permissible but even the prime motive. Let the profiteers which certainly include even the church run institutions, be permitted to accept capitation fee openly. Let there be no ban by law. In any case, even the holy priests of all colours are accepting it beneath the table. The market forces in a short span of time will certainly make capitation fee non-existent. It will make all law which prohibits capitation fee irrelevant in the same way the liberalization has vanished smuggling and made COFEPOSA irrelevant.

One need to wait only for a few years to see for the ‘profiteers’ running after students offering courses at affordable rates. Only the best will survive. Those among them, who can’t provide the standards; the weak and meek, will suffer a natural death. If, the laws of the market could work well in the rest of the world, it will work well in India too. The IIMs in India are an example. Admissions to it are the most sought after. Graduates, who come out of it, are picked up in the campus by MNCs and big companies in India and abroad. Rs.85 lakhs was the package offered last year! There are hundreds of other Management Institutions in India, poor cousins of the IIMs. They go with a begging bowl looking for faculties and students. The same could be the fate of the ‘self financing colleges' who today enter the market with their eyes on quick money.

The market will take care of such malignancies. Only those who could provide the best of education, maintain the best of standards, best of faculty and good infra structure alone will survive. Others who had mushroomed, hoping to make quick buck will have the fate of mushrooms themselves. They will wither away. There is no need for even a law to regulate standards. But we already have a plethora of laws by the Parliament like the Medical Council of India Act, AICTE Act etc to regulate. Therefore, there is no need for the Governments to step in. They did so with “vote banks” in mind.

During every monsoon in Mumbai not only floods cause calamity. Many people die in old unsafe buildings which collapse unable to bear brunt of the rains. The BMC has in its list hundreds of buildings which are declared unsafe. Bombay stands in the top of the list, when it comes to price of square foot of land. Yet, worthless, dilapidated buildings fill the sight of the city thanks to Rent Control Act. Like fashion, compare the taxis in Bombay, which is a shame to the city, with the ones in any other foreign city. If the government could issue taxi permits liberally, like in Singapore, an ordinary citizen could travel even in a Benz car as taxi for affordable charges. Again think of the “progressive” nationalization of Banks by late Indira Gandhi. In 1971, the prime lending rates were less than 10%. After nationalization it shot up to 23%. And thanks to that the Indian Industry had to survive on ventilation till banking sector was opened up and alien concept of “securitization” was brought in. Today, a young employed, middle class couple could buy a house worth Rs. 50 lakhs on loan up to 90% of the cost and that too without any other security than the house.

It is a matter of disbelief that the aforesaid economic realities were hardly heard and discussed in the course of hearing of the self financing colleges by a Division Bench of the High Court of Kerala, as happened in TMA Pai’s case earlier.

There is yet another aspect as clear as broad day light which still missed. The Kerala Act of 2006 provides for reservation upto 82% including 25% to OBCs. The minority/management quota was reduced to 15%. In a country where any criticism of reservation is a sacrilege, the Kerala Act of 2006 was somewhat fair as it introduced for the first time reservation on economic basis at 12%.

However, the Christian and Muslim leaderships challenged the Act with all their might; in the Courts as also in the streets. However, they could not be but pleading for their vested interests only. There cannot be a greater deceit than their claim for the protection of minority rights. Protection against whom? They run more than 90% of the institutions. Not the silent majority of the Christians and Muslims, the so called minorities, but the Church and Muslim leaderships. And the silent majority in no way could join cause with them. The author too is a member of a minority community.

The high pitched talk of minority interest at imminent danger is nothing but dishonesty. It is a tragedy that the church leadership too wittingly or unwittingly fell into the trap laid by wrong-headed people. The Christian Institutions like C.M.C.Vellore, St. Johns, Bangalore, St. Stephens, Delhi and many like them are still in their zenith of glory, for a long time. In Kerala, Christians run majority of the institutions. Now Muslims too are trying to catch up fast. Together they run majority of the private professional and other educational institutions. If they still cry wolf, they would be making, not them, but the silent majority of the minorities pay a price for that. They would be by their selfishness tearing the fabric of harmonious social co-existence of the people of different religions. Anyone who for selfish reasons raises the minority card should remember that the best protection that could be given to the minorities is the protection which the majority gives. The morally unjust and unethical, high pitched clamour for protection of minority interest and the dishonest cry that it is in imminent danger will only provide the fertile soil for the growth of communal and divisive forces among the majority community. You are sowing the seeds of distrust of minorities among the poor Hindus who are known the world over for their tolerance all through the history.

It might sound bizarre. The Kerala Self Financing Colleges Act drawing strength from the 93rd Constitutional Amendment make reservations for OBC's and others mandatory. I am not going to the hypocrisy and the narrow political motives behind it. The reservations, time has proved, cannot be a blessing. But it is only a bane. It is just like the economic polices intended for the benefit of the poor. Economists today think economic policies intended to benefit the rich, actually benefit the poor more. Opening up of telecom sector, aviation etc. is a case in hand, Today, a rickshaw puller of Calcutta has a mobile in his hand. A low rung employee of a private company could travel from Mumbai to Delhi for less than Rs.2,500/-, while many of the telecom companies and airlines are bleeding. Like manner, reservation has only hit, the "reserved" badly. Take the case of the Latin and Syrian Catholics of Kerala.

The former enjoy reservation while the latter not. The Syrian Catholics and, particularly, the poor among them who do not enjoy any reservation are far better off than their cousins, Latin Catholics. The Syrian Catholics who did not enjoy reservation, out of economic compulsions took to nursing and other para-medical courses and ventured to Gulf, Europe and Americas. They are today gainfully employed and are well off. Their cousins who enjoy reservation end up with small Governmental jobs with little pay. In like fashion, the men folk of Syrian Christians went abroad and managed to come up in life. This reality is so stark that it needs no proof. A mere visit to Kottayam and Pathanamthitta districts dominated by Syrian Christians and the Latin Catholic belt of Kochi and Quilon districts will reveal this.

As an epilogue, I should say the interest of the student community, the minorities and the backward classes will be better served, if hypocratic, political and legislative interferences in the name of their betterment which actually do no good and do immense harm are put to an end. Let, the laws of nature and market shape their future. There could be inequities, hardships and even agonies, which the “markets” will not take care of. But it is still a far more welcome situation than the injuries caused by artificial interference by the state, which has failed here as also in the rest of the world.

Mathews. J. Nedumpara
Advocate 

http://nedumpara.com/