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For five months now, the Indian Institutes of Management have been embroiled in controversy over a cut in its fee structure and interference from the Union human resources development ministry, then run by Dr Murli Manohar Joshi.
On February 5, the Atal Bihari Vajpayee government asked the six premier IIMs to slash its fees by 80 percent.
While many management experts ridiculed Dr Joshi's aggressive stand, some agreed with the minister, saying it was the government's prerogative to reduce fees at the IIMs.
Dr Joshi's insistence of a fee cut led IIM-Calcutta, IIM-Kozhikode, IIM-Lucknow and IIM-Indore to accept the government decision.
While IIM-Ahmedabad led by the chairman of its board of directors, Infosys Chairman N R Narayana Murthy, argued against the fee cut, the board of governors at IIM-Bangalore did not take a decision on the issue.
But the change of government has now ensured that the IIMs need not change its fee structure.
One of current HRD Minister Arjun Singh's first decisions was to undo Dr Joshi's controversial fee cut decision.
After a meeting with the directors of the all the IIMs Singh issued a directive ordering the immediate withdrawal of Dr Joshi's ruling cutting IIM fees. The new directive has a rider: that the IIMs should provide scholarships to poor students that may amount to a full tuition fee waiver.
According to the new order: 'All the admitted students, whose annual gross family income is Rs 2 lakh and below, will be eligible for receiving financial assistance amounting up to full tuition fee waiver.'
What will the fee structure at the six IIMs now be?
IIM-Ahmedabad: The credit for the IIMs' fight against the fee cut decision goes to the country's leading IIM. Last year, the fee at IIM-A was Rs 150,000. It has increased to Rs 157,000 this year. The premier IIM does not take government assistance to fund the education of poor students. IIM-A has a corpus of Rs 98 crore (Rs 980 million). It has a Rs 1 crore (Rs 10 million) corpus fund exclusively meant for scholarship for students whose families earn less than Rs 200,000 a year.
IIM-Bangalore: This IIM also consistently argued that a fee cut would considerably weaken a well functioning, world-class institution. It will retain its old fee of Rs 150,000 per year. It has also decided to considerably increase the value of scholarships. Currently it is Rs 25 lakh. It could be increased to Rs 1 crore. IIM-B has a corpus of Rs 53 crore (Rs 530 million) and a general reserve of Rs 9 crore (Rs 90 million) in its kitty. It also has a terminal benefits reserve of Rs 22 crore (Rs 220 million).
IIM-Calcutta: IIM-C's Faculty Council has requested the government to initiate a process of mutual consultation and discussion with different stakeholders before imposing such a drastic fee cut. Though the IIM-C board of governors headed by ITC Chairman Yogi C Deveshwar decided to accept the fee cut order, it inserted a clause in the decision saying that a final resolution to the matter would be made subject to the Faculty Council's concern on autonomy. Now that the controversy has been resolved, IIM-C has decided to take the existing fee: Rs 127,000 a year.
IIM-Lucknow: IIM-L along with IIM-K and IIM-I did not want to take on the government over the fee cut order. IIM-L will keep the existing annual fee of Rs 130,000, but has decided to waive this fee for students whose families earn less than Rs 200,000. It has requested the government to assist all future programmes as the corpus fund available with IIM-L is around Rs 8 crore (Rs 80 million) only.
IIM-Kozhikode: IIM-K was the first IIM that whole-heartedly accepted Dr Joshi's diktat. When the fee cut controversy reached its peak, A C Muthiah, chairman of IIM-K's board of governors, called the meeting that endorsed the fee cut directive unanimously. 'The fee cut has not affected the autonomy of IIM-K. I would like to say there is no curb on our autonomy,' Muthiah had then said. But now that the government has ended the controversy, IIM-K has quickly decided to retain last year's fee of Rs 110,000.
IIM-Indore: IIM-I's fee structure is the cheapest compared to the other IIMs. It will retain the last year's fee structure of Rs 108,000 per year. It has also made a provision for need-based financial assistance to students whose family income is less than Rs 200,000. IIM-I is all set to explore resources generation schemes such as contributions from its alumni and industry to create a fund for providing on its own, need-based financial assistance in the next few years.