Savers penalised for parsimony

March 6, 1998

INDIAN higher education's longest-running controversy - the funding of universities - has been given a new twist with the University Grants Commission's plans to link the grant to average expenditure per student.

Universities negotiate with the UGC for each year's grant on the basis of their overall expenditure in the previous year and what they expect to spend in the next. Under an "incremental" system, the universities get more every year and no questions are asked about the "unspent" money. All this will change on March 31.

The UGC says the new system is not intended to "prune" university grants but to encourage universities to ensure "efficient utilisation of resources". The UGC will set up a unit cost cell to monitor how efficiently the funds are used by each university.

The proposal, part of the government's bid to streamline higher education funding, has already provoked complaints. Delhi University, threatened with a strike by its teachers over a pay rise, has expressed reservations, saying that the UGC's plan would add to its existing "resource crunch" making it even more difficult to manage the university efficiently.

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