Profit and loss in a knowledge society
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The proposal to promote for-profit initiatives in higher education reflects misplaced priorities
Michael Sandel, a professor of political philosophy at Harvard University, in his recent book What Money Can't Buy: The Moral Limits of Markets, has observed: "At a time of rising inequality, the marketisation of everything means that people of affluence and people of modest means lead increasingly separate lives. the question of markets is really a question about how we want to live together. Do we want a society where everything is up for sale? Or are there certain moral and civic goods that markets not honour and money cannot buy?"
The availability of good quality higher education that is affordable, accessible, and that promotes equity and efficiency, is an essential public good, which needs to be promoted by public and non-profit private sector initiatives.
The Planning Commission's (PC) recent proposal in the draft 12th Five Year Plan to promote "for-profit" initiatives in higher education is a retrograde step. The ostensible reason is to address the growing concerns relating to lack of good faculty, infrastructure and resources and the PC has observed that the objective is to "bridge the demand-supply gap in higher education". The jurisprudential foundations of the "not-for-profit" character of an institution should not be confused with the ability of institutions to determine their fee structure and the compensation they can pay to staff. The critical aspect of non-profit is that the additional income generated by the institution is retained and used for its development. This is typically used for research initiatives, scholarships and fellowships, as well as infrastructure development. Ideally, the surplus should be not be taken back by the management or the private donors. This is how an endowment can be created and the financial viability of the institution could be protected. The PC's approach poses many challenges to the basis of higher education reform.