The Supreme Court has ruled that private schools shall not recover as arrears for any reason or under any circumstances 20% reduction in fee directed through its order dated 30-12-18. The Court on December 30, 2018 had directed all the educational institutions receiving fee in excess of Rs 5,000 per month to reduce their fee by 20%.
A three-judge bench, headed by Chief Justice Asif Saeed Khan Khosa, on Friday released its detailed judgment on the private schools fee case. The 72-page judgment authored by Justice Ijazul Ahsan noted that despite its order the schools have excessively increased fee since 2017 in violation of its order therefore all such increases are struck down. It will be deemed that there was no increase in fee since 2017 and fees were frozen at the rates prevailing in January 2017.
Schools fee shall be recalculated using the fee prevailing in 2017 as the base fee in accordance with the provisions of laws of Punjab and Sindh, respectively (adding annual increases permitted by the law/rules/regulations) till 2019 and onwards. The process of recalculation shall be supervised by the regulators and only the fee approved by them shall be treated as the chargeable fee.
Any excess fee found to have been charged shall be adjusted in the future fee. The regulators shall closely monitor the fee being charged by private schools to ensure strict compliance with the law and the rules/regulations. Complaint cells shall be set up to deal with complaints arising out of increase in fee in violation of the law/ rules/ regulations.
The judgment noted that since the beginning of June 2017 a number of private educational institutions have been increasing their fee exorbitantly in violation of the relevant laws/rules. 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 being faced with the prospect of either paying the increased fee by hook or by crock or to look for other alternative options which in the field of education are extremely limited.
It said, "In order to cater for this situation that we had, through an interim order dated 30.12.2018 directed all educational institutions receiving fee in excess of Rs 5,000 per month to reduce their fee by 20%." The judgment said that there is sufficient empirical evidence in the auditor general's report that pointed towards profiteering. It noted that no empirical data, figures or statistics worth of any weight was presented on behalf of the private educational institutions to contest, dispute, explain or dilute the conclusions of the report of the auditor general.
Revenue cap regulation is not a concept unknown to Pakistani legal system. The whole purpose of revenue cap regulation is to limit the total amount of revenue that a firm operating in a particular industry with no or very few competitors can earn. In economic theory, such regulation is employed as an incentive to reach a desired outcome for society which in this case is the provision of education that is accessible and does not become inaccessible by virtue of exorbitant and unreasonable increase in school fees. "While such regulation can be adopted by governments and regulators in any industry, this is true more so for utilities and essential services that are intrinsically linked to fundamental rights in which the objective is availability and affordability of the utility or service while ensuring quality," said the judgment.