Joshi slashed IIM fees, tore his Govt promise to shreds

In fact, the brief the Expenditure Reforms Commission, chaired by former Finance Secretary and IMF executive director K P Geethakrishnan, got from the Government couldn’t have been clearer: ‘‘suggest measures for… reducing budgetary support’’ to autonomous institutions.

So Joshi’s decision to cut IIM fees by 80%—and thereby increase their dependence on Government funding—not only flies in this face, it also makes a mockery of the Geethakrishnan commission’s advice to this Government.

Consider the following:

• The panel told the Government that autonomous institutions be allowed to ‘‘maximise internal resources generation so that the dependence upon government budgetary support could be kept at a minimum.’’ Just the opposite is Joshi’s order slashing the annual IIM fee by 80% from Rs 1.5 lakh to Rs 30,000.

• The panel advised the government that a small number of autonomous institutions—say 20 or so— ‘‘whose performance is outstanding and internationally acclaimed as to warrant further encouragement by giving greater autonomy,’’ should get ‘‘increased flexibility in matters of recruitment and financial rules.’’

Joshi disregarded the fact that there is no way the IIMs, at least the ones in Ahmedabad, Kolkata and Bangalore, can be kept out of this special category. And, far from allowing the IIMs such leeway, Joshi attacked them for building a corpus that would enable them to become financially independent.

• But the most glaring departure Joshi made is from the very principles the panel laid down with regard to institutions comparable to the IIMs. Take the recommendation for granting greater autonomy to Indian Institute of Foreign Trade (IIFT), New Delhi, even though it is rated lower than the IIMs. It noted that IIFT has ‘‘a potential for increasing its internal cash generation to a point where it should not be dependent upon the Government for its day-to-day expenditure requirements.’’ This objective should be achieved in two to three years and then IIFT, the panel said, ‘‘could be freed from Government controls altogether.’’

• Another clear example contradicting Joshi’s decision is the recommendation on Indian Institute of Forest Management (IIFM), Bhopal. In this case, too, the panel said that IIFM ‘ could endeavour to raise more resources by levying appropriate levels of fees for the various courses run by it.’’

In other words, to impart greater autonomy to IIFM, the panel proposed a fee hike for its students.

• Even when an institution needs government funds, the commission said that autonomy should be the ultimate objective. It cited the National Institute of Design (NID), Ahmedabad, as an example. This premier institute of design education has to depend on government grants as it has not been able to generate much revenue from projects and tuition fees. The commission, therefore, recommended that ‘‘the present set up may continue and withdrawal of government grants may be considered after the internal revenue generation goes up substantially.’’

Besides Geethakrishnan, the panel included: expenditure secretary C M Vasudev, secretary in Finance Ministry J S Mathur, member of PM’s Economic Council Kirit Parekh and former finance adviser to Defence Ministry V S Jafa.