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Governance challenges in K-12 education in India
Significant work has been done on de facto operations of state functionaries (World Bank 2004; Posani and Aiyar 2009; Aiyar, Chaudhuri and Wallack 2010; Pritchett 2018; Centre for Civil Society 2019). But there is limited research on the de jure framework for K-12 education in India, especially for private schools. Information on roles of state education functionaries for public and private schools is scattered. Clarity on these roles is necessary to establish sharp lines of accountability. This is crucial, especially since private schools have to compete with the government that sets the rules for all schools and operates its own schools.
We dive in and examine the rule-sets for Maharashtra, Delhi, Haryana, Jharkhand, and Uttar Pradesh. In particular, we analyse the language of the legislation and identify responsibilities of functionaries. Alongside the Right of Children to Free and Compulsory Education (RTE) Act 2009, we study 26 state Acts, corresponding rules, and School Codes wherever applicable. School Codes contain subordinate legislation (executive orders, notifications, circulars, and court judgements) that pertain to school education. We also study the implementation framework for the Samagra Shiksha Abhiyan as it allocates responsibilities to state education functionaries.
What do we find in common across states? The government regulates private schools at multiple touch-points. Schools need to obtain recognition in order to operate. They can only hire employees with minimum qualifications as prescribed by the government or after obtaining permission from the state Department. Private schools need to operate “in public interest” to avoid losing control over their management. They are also subject to caps on fees that often do not account for investment in new facilities or expansion of schools. The regulatory framework also lacks a systematic dispute resolution system with clear distinction between the disputants (parents, schools, and government).
States also fare poorly on frameworks that examine the regulatory environment for private schools, including the Systems Approach for Better Education Results - Engaging the Private Sector (SABER-EPS) of the World Bank (2014) and that of Vidhi Centre for Legal Policy (2017).
After comparing the language of the legislation for private schools with that for government schools, we find a striking absence of accountability mechanisms for the latter. While private schools are subject to clauses such as “shall cease to function” or “may take over”, government schools do not face any such enforcement actions. We also find that state functionaries are vested with multiple and overlapping functions, including regulatory, service delivery, financing, and assessment.
When the rule-writer is also the service provider, day-to-day pressures of management compromise its attention to on-ground outcomes. The administration tends to become insular and conceal mistakes (World Bank 2004). We need to implement thoughtful separation of powers in K-12 education administration. Uncoupling roles of functionaries and determining who should be accountable to whom and for what, makes for efficient outcomes and clear lines of accountability (World Bank 2004; Posani and Aiyar 2009).
Regulation for New Realities- A Cross-Sectoral Analysis during COVID-19
Regulation for New Realities: A cross-sectional analysis during COVID-19
COVID-19 took the world by shock. What started as a small infection has spread across several countries, inflicting harm to millions of people and setting the global economy back by decades. As of September 2020, India adds close to 100,000 COVID-19 cases per day. Economists estimate the real Gross Domestic Product (GDP) growth to contract by at least 10.5% for 2021.
COVID-19 has made apparent the need for changes in the way the government regulates various sectors. Crises have frequently provided opportunities for reforms. The liberalisation of 1991, for instance, was motivated by a balance of payments crisis.
During the summer of 2020, we at Centre for Civil Society documented how some critically affected sectors are trying to adapt to the changing circumstances, but are fettered by the regulatory framework. We examined seven areas: health, education, labour, agriculture, technology enterprises, philanthropy and professional certification.
We used a common lens to examine the regulations in each of the areas of study and discovered that at the heart of it our regulations are not fit for purpose. In some areas, the regulatory framework is absent or muddled; in other areas overwrought. and in yet other areas, they are ambitious, but out of sync with state capacity. They are outmoded for the new reality across the board.
Our regulations across sectors favour incumbents over disruptors. The regulations create strong barriers to innovation and adaptability. For instance, e-pharmacies have been operating in a vacuum, absent clarity on their obligations and liabilities. This stasis is partly a result of the pressure campaigns from brick-and-mortar pharmacies.
Regulations are also susceptible to capture and monopoly. Professional certification requirements for lawyers do not recognise distance-learning. This has hurt the ability of law schools to use new modes of teaching. The Bar Council, in a bid to restrict entry and increase wage premiums, have made it hard to imagine new ways of bringing legal professionals into service.
The regulatory architecture often favours a one-size-fits-all approach. For example, where democratising education may allow non-traditional learners to prosper, the regulations encourage standardisation and uniformity. Options for school exit-certification make it hard to exercise choice and to experiment with what works for parents and their children.
Regulators in India also capitulate to public perceptions over empirical data, sometimes even making it hard to generate evidence critical for decision-making. The regulatory framework for seeds does not make it easy for technology developers to conduct field trials before making biosafety determinations. Even though farmers across the country are slowly being freed from the license-permit-subsidy raj, they remain hostage to an aversion to modern science.
A regulatory framework that is ambitious but fettered by State capacity constraints can do more harm than good. We have watched our neighbours take advantage of their periods of demographic dividend, we have remained a prisoner of overwrought rules on every aspect of employing workers. During COVID-19, many states have tried to quickly tinker with labour regulations to make them flexible enough to generate mass employment. Yet, as states try to break free, the Centre’s laws hold them back.
Contrastingly, where State capacity to regulate may be limited, the market has shown us new ways to set standards and enforce rules. Door-step delivery of food via aggregator platforms have brought us market-led regulation of hygiene and safety. Food aggregators were steps ahead of the country’s food regulator in setting standards and using technology to enforce those standards. They were able to quickly deploy systems to monitor standards, and build feedback loops for improving performance: something the food regulator has struggled to do.
Regulations that hamper innovation and create incentives for incumbents to stagnate, hurt the creative destruction process that is at the heart of generating growth and value. Through this compendium, we hope to make the case for first-principles thinking in writing the rules of the game. In each paper, we have tried to identify the challenges of the current regulations, and in some cases suggested models for reform.
Playbook for Reforming Indian Agriculture
Government and society in India have historically viewed farming merely as a means of achieving food security for the country. Farmers are considered annadatas, instead of legitimate entrepreneurs engaged in the business of agriculture. The liberalisation of 1991 did not touch the agriculture sector.
Despite decades of policy interventions, a majority of Indian farmers have not seen their incomes rise, nor have they been able to increase farm productivity. Farmers with small or marginal holdings, who make up around two-thirds of all farmers, find themselves prey to indebtedness, a lack of choice in inputs, and underdeveloped warehousing and processing facilities. In each agricultural cycle, we witness a host of farmer agitations, leading to further band-aid solutions.
The Union and states provide a host of subsidies for agricultural inputs and offer high prices for outputs by procuring food grains at minimum support prices for multiple crops. Simultaneously, policymakers walk the tightrope of protecting consumers from high prices through inexpensive grains to over two-thirds of the Indian population.
These policies ignore that the distress in the sector largely results from farmers having little or no control over anything in agriculture except perhaps tilling the soil. The government interferes with decisions at every step of the production and sale process. Pulled together, the policy framework has destroyed the signalling role played by prices, and no one is better off for it.
The Finance Minister, in her first budget speech in July 2019, expanded the scope of ease of doing business to include rural enterprises. She also opined that “ease of doing business and ease of living both should apply to farmers too.” Unfortunately, the political and social discourse in India still does not see the farmer as an entrepreneur who takes risks, analyses the market and engages in the production, marketing and selling of agricultural produce.
Against this background, the playbook:
- imagines agriculture as an enterprise, and casts agriculturists as “farmpreneurs”;
- distils key learnings from richer studies and reports; and
- outlines the full-spectrum of reforms needed in the sector.
Much of the policy approach has been hostage to the myth of the “first transaction”, a notion as archaic as it is dangerous. The playbook’s approach has been to sidestep this notion and to treat the sector as any other. Farmers are not isolated actors, but entrepreneurs who engage in the market process, absorbing cues from prices and the actions of their competitors and buyers, making business decisions on what seeds to use and arbitrage potential in storing for later sale. This playbook lists eight distinct reforms needed in the agriculture sector so our farmpreneurs may be free to make and sell. These reforms cut across myopic land regulations, the regressive input subsidy and control regime, and the fetters on spot, futures and credit markets. The playbook largely focusses on bad policies that need repeal or revision, less so on things, the government needs to do more of.
Progress Report 2020: Implementing the Street Vendors Act
Street vendors form an integral part of the urban economy—majority of the population depends on hawkers for affordable goods and services. Vending constitutes a sizeable proportion of the informal sector and creates opportunities for entrepreneurship and self-employment. For several decades post-independence vendors faced harassment, extortion and eviction at the hands of local authorities and found no respite from courts either.
In 2014, recognising the rights of vendors to earn a dignified living, Parliament passed the Street Vendors (Protection of Livelihood and Regulation of Vending) Act 2014. The Act introduces a uniform framework to regulate vending, but delegates rule-making and decision-making powers to state governments and local authorities. Compliance with the Act has two components: formulating subordinate legislation (de jure) and introducing institutional mechanisms and processes (de facto) by which vendors’ rights are protected and conflicting claims over urban streets are managed.
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Figure 1: Tracking de facto and de jure progress made by states since 2014
Since 2014, Centre for Civil Society has tracked the de jure and de facto progress made by states in implementation. This year, drawing from the Management Information System maintained by the National Urban Livelihoods Mission (NULM), we obtained data on implementation progress at the level of states and urban local bodies (ULBs). The 2019-20 report builds on our previous practice of tracking state progress and contains three sections.
First, we review the progress made by 28 states and their respective ULBs in implementing the Act using data received from the MoHUA. We rank and score state performance and present a list of top performing ULBs across the country.
Second, we present a cross-state comparison of rules and schemes notified under the Act. Using maps and simplified tabulations we capture the patterns, variations and similarities in the way states approach the same rule-headings.
Third, we present the salient features, hits and misses of the rules and schemes of 35 states and union territories. For each state, we examine whether the delegated legislation departs from the mandate of the Act and encodes checks against administrative excesses.
What do we find?
1. Mixed state performance in implementing the Act:
(a) Many states have substantially progressed in implementing the Act. The range of scores on the Index has risen from 9-76 points (out of 100) in 2018-19, to 20-78 points in 2019-20. In Andhra Pradesh, the highest ranking state, all towns have constituted Town Vending Committees (TVCs), completed enumeration, formulated vending plans, issued identity cards and demarcated vending zones.
(b) Other states continue to fare poorly. Seven states (Assam, Haryana, Karnataka, Maharashtra, Madhya Pradesh, Puducherry and Uttarakhand) are yet to notify schemes and two states (Telangana and Uttarakhand) are yet to notify rules. Although 75% of ULBs have formed TVCs, only 47% have vendor representatives. In four states (Maharashtra, Puducherry, Telangana and Tripura) no ULB has constituted TVCs with vendor representation. In states where most TVCs have completed surveys, vending certificates have not been issued. Only four states (Madhya Pradesh, Nagaland, Punjab and Uttar Pradesh) have constituted grievance redressal committees.
2. While some ULBs represent best practices, most ULBs show glaring inconsistencies with the Act in their method to madness:
(a) Even in the top performing states, ULBs are implementing the Act on their own terms. They have enumerated vendors, distributed vending certificates, formulated vending plans and demarcated vending zones without constituting TVCs—the mainstay for all processes.
(b) Of the 3,248 ULBs in our dataset, less than 131 ULBs ( 4%) meet the criteria for top ULBs. Most of the best performing ULBs (109) are in Andhra Pradesh. Other 22 ULBs are spread across eight states: Tamil Nadu, Rajasthan, Mizoram, Kerala, Jharkhand, Gujarat, Himachal Pradesh and Madhya Pradesh.
3. In many cases, notified rules and schemes introduced by states appear to go against or beyond the mandate of the Act:
(a) In some states, rules and schemes delegate powers to state governments and local authorities that go beyond the mandate and intent of the Act. For instance, in Arunachal Pradesh, Bihar, Goa, Haryana, Karnataka, Nagaland, Andaman & Nicobar, Chandigarh, Daman & Diu and Delhi rules empower state governments to remove any member of the TVC. This mandate finds no mention in the parent Act.
(b) In other states, rules and schemes fail to provide clear guidance on executive action. For instance, in Arunachal Pradesh, Bihar, Chattisgarh, Manipur, Meghalaya and Nagaland schemes introduce ’misbehaviour’ as grounds for suspension of vending certificates without defining what constitutes ‘misbehaviour’.
(c) In yet other states, the delegated legislation introduces new obligations that are not mentioned in the parent Act. For instance, in Rajasthan and Meghalaya, schemes mandate vendors to maintain record books for TVCs to inspect at any time.
By tracking state and ULB level performance, our report highlights the gaps in implementation and allows state authorities to draw lessons from one another.
Restrictions on for-profit education in India
Restrictions on for-profit education in India mainly stem from Supreme Court verdicts, Model and state Right of Children to Free and Compulsory Education (RTE) Rules, and board affiliation norms.
Supreme Court Verdicts
For both K-12 and higher education, the following two court judgements regulate the ability of educational institutions to run for-profit.
T.M.A Pai v. State of Karnataka, 2002: The Court directed that educational institutions could make a “reasonable surplus”2 but disallowed profiteering and charging capitation fees. It argued that “reasonable surplus” to meet the cost of expansion and augmentation of facilities did not amount to profiteering.
Higher Education Legislation
University Grants Commission
The University Grants Commission (UGC) Act 1956 does not explicitly restrict for-profit education. But Section 26(1)(g) of the Act grants UGC the power to regulate the “maintenance of standards and the coordination of work or facilities in Universities.” This can potentially allow UGC to regulate fees in higher education institutions. Recently, UGC released draft regulations governing the fee structure in private aided and unaided institutions under this provision.
School Education Legislation
Model RTE Rules
For K-12 education, the RTE Act 2009 requires private schools to fulfil certain norms and requirements to obtain a Certificate of Recognition. These schools cannot operate without this certification. Though the RTE Act 2009 does not mention restrictions on schools run for-profit, its Model Rules require schools to be non-profit in order to qualify for recognition. According to Rule 11(1)(b), every school applying for recognition should submit a self-declaration showing that they are “not run for profit to any individual, group or association of individuals or any other persons.” This restriction is replicated in several state RTE Rules.
State RTE Rules and fee regulation Acts
States restrict the kind of schools that can apply for recognition through their RTE Rules. Schools that can apply for recognition generally have to be run by the following entities:
- Societies registered under the Societies Registration Act, 1860 or under state government Acts for educational, religious or charitable societies
- Registered Trusts or
- Companies registered under Section 8 of the Companies Act 2013 having education as one of its objects
Only Haryana has allowed for individuals or a group of individuals or companies registered under the Companies Act 2013. Rule 12(1)(a) of the Haryana RTE Rules 2011 states that the following entities can open a school in the state
- Individual/association of individuals/firm/society registered under the Societies Registration Act 1860
- Trust created under the Indian Trusts Act 1882
- Company registered under the Companies Act 1956
States such as Maharashtra (Section 11(1)(b)) and Delhi (Section 14(1)(b)) also clearly mention that schools should “not run for profit of any individual, group or association of individuals or any other persons.”
While many states pass orders and notifications to regulate fees in schools, 11 states in India have stand-alone Acts that govern school fees. The Punjab Regulation of Fee of Unaided Educational Institutions Act 2016 is the only such Act that explicitly regulates profit-making by schools. It constitutes a Regulatory Body for regulating fees at the divisional level. Under Section 7, one of the functions of this Regulatory Body is to “check excessive hike in fee by an unaided educational institution with the motive to earn profit.”
Board Affiliation Norms
Affiliating boards such as the Central Board of Secondary Education (CBSE) also impose restrictions on how schools can operate. We look at two such examples below.
Central Board of Secondary Education (CBSE) Affiliation Norms
Similar to State RTE Rules, Section 2.1.8 of CBSE Affiliation Bye-laws 2018, states that the CBSE may affiliate the following categories of private schools established by:
- Societies registered under the Societies Registration Act 1860 of the Government of India or under the Acts of the State Governments as educational, religious or charitable societies
- Registered Trusts or
- Companies registered under section 8 of the Companies Act 2013 having education as one of its objects
Council for the Indian School Certificate Examinations (CISCE) Rules for Affiliation
Rule 2(a) of the CISCE Rules for Affiliation 2016 states that the school should be “run by a Registered Society, a Trust or a Company (under Section 25(1)(a) of the Companies Act 1956 or as amended) for educational purposes. It must not be run for profit.”
Existing rule-sets governing K-12 Education in India
Education in India is a concurrent subject. Both Union and state governments can regulate school education. This has led to varying rule-sets across states. We compiled existing rule-sets for all states in India using legislation listed on the state Department website and online sources including Laws of India, Manupatra, Bare Acts Live and Latest Laws.
We collated 145 Acts and 101 corresponding rules across all states. On average, each state has 4 Acts and 3 rules approximately. Uttar Pradesh has the highest number of state Acts at 11 and Karnataka has the most number of rules at 17. Arunachal Pradesh, Chhattisgarh, Chandigarh, Kerala, Nagaland and Uttarakhand have 1 state Act each. Generally, southern states have a higher number of rule-sets than northern states. We could not find any rule-sets for Andaman & Nicobar Islands, Dadra & Nagar Haveli and Lakshadweep.
We also classified all rule-sets as per the touchpoint they were meant to regulate. For instance, we categorised the U.P. Self-Financed Independent Schools (Fee Regulation) Act, 2018 under “fees in private schools.”
For all states with rule-sets, we found legislation regulating the process for opening a school. Most states have Acts apart from the RTE Act 2009 that still apply to this process. A few examples are the Delhi School Education Act and Rules 1973, Orissa Education Act, 1969 and Gujarat Educational Institutions (Regulation) Act, 1984. Rajasthan Non-Government Educational Institutions Act, 1989 also lays out recognition norms but Rajasthan RTE Rules 2011 mandate recognition only under the older Act. Similarly, all states with rule-sets apart from Tripura, regulate employment of teachers in private schools.
Currently, the regulatory framework for K-12 education in India is ridden with obstacles for edupreneurs. In order to build an effective regulatory environment that allows the best-placed edupreneurs to enter the education sector, we need to facilitate the shift towards principles-based regulations.
Matrices of State Rules and Schemes under the Street Vendors Act, 2014
The Indian Parliament enacted the Street Vendor (Protection of Livelihood and Regulation of Street Vending) Act in 2014, to prevent harassment of street vendors and to regulate their livelihood. Given the important role played by local authorities in regulating street vending, the Act delegates rule-making powers to the State Government. It specifies the respective authorities for making rules, schemes and bye-laws, neatly delineates the rule-making heads/matters for each of these and specifies the timeline for enacting them. While State Governments are tasked with framing rules and formulating schemes, municipal authorities have to enact bye-laws.
Apart from shaping local governance, the content of State schemes and rules have a bearing on the vendors’ right to occupation and the duties imposed on them. While the parent Act sets the contours for regulation, States vary in the way they adopt, interpret or elaborate on the different aspects of street vending.
We have prepared two matrices that feature cross-tabulation of all state rules and schemes under the Street Vendors Act, 2014. These matrices are user-friendly tools that facilitate a comparison between States based on the different ways in which they approach the same rule-headings, under the parent Act.
Section 36 (2) of the Central Act directs the states to notify rules within one year from the date of commencement of the Act. Sub-sections 2(a) to 2(r) outline the matters that the rules may address. These include the dispute redressal mechanism, the constitution and functioning of the Town Vending Committee (TVC), record maintenance, social audit and the returns to be furnished.
The matrix on State rules clubs these 19 rulemaking heads under 5 categories. These 5 categories are further classified into smaller specifications to provide clause level summaries of the different State provisions. Some columns are empty. Since the parent Act does not mandate the rules to deal with all matters, some states have not introduced any provisions for specific matters.
Per section 38, states should draft and notify the scheme within 6 months from the commencement of the Act, in consultation with the TVC and the local authorities. The second schedule of the Act elaborates on the matters that the scheme may address. This includes laying down the process for conducting the survey, issuing identity cards and certificate of vending, the guidelines for earmarking vending zones, vending regulations for different categories of vendors, provisions regarding vending fee and the relocation and the eviction of vendors.
The matrix on State schemes clubs these 29 rulemaking heads under 13 categories. These are further classified into smaller specifications to provide clause level summaries of different scheme provisions.