Attempt to regulate private school fee

Now a days Delhi government is trying to regulate fee hike by private schools. Government says that these private schools are making huge profits and regulating school fee will reduce burden of parents.

This move has a downside also. Schools are prevented from charging high fee but are not prevented from making huge profits. The schools will not sacrifice their profit because of cap on school fee but will reduce facilities to students. The quality of infrastructure and quality of teachers will suffer because these schools will cut on expenditure salary of teachers. Good teachers will move to some other states where schools are offering good salary or join some coaching center which don't come under fee regulation. School education will suffer and profit of schools will still not come down. It will be a loss for parents because now they need to send their children to coaching classes also because schools are not having good teachers.

So what is the solution? Should government not do anything and let schools loot the parents of students?

The solution is not to kill free market economy. Market knows the best if school A is charging 3000 rupee per month and school B is charging 5000 rupee per month and school B is having all seats occupied and school A is having 10% seat vacant then there is some reason for it. Market knows the best about the services being offered to them. We can't say that school B is looting the parents and school A is not. On the contrary it looks like school A is looting the parents and that is why 10% of the seats are lying vacant.

The government needs to build good schools and provide good education there. This will create competition in the market and people will start leaving overpriced schools and these schools will start spending in providing good services and reducing the fee.

Price control hinders new inventions. No schools will roll out new technology in their schools if they can't fund their expenditure by raising the fee. The government has failed miserably in managing government schools and wants to kill competition in private schools. Government is still leaving these private schools with same management which it accuses of corruption and profiting. Why doesn’t government take over these schools and run them better than current management? Government doesn’t have that capability people know that. Government should concentrate on providing good education services to people by hiring more teachers for schools rather than wasting money in putting CCTV in every classroom. Once there are sufficient number of schools are there and quality of education is good there, private schools will be forced to provide better education to student at lower fee otherwise they will be shutdown.

I see fee regulation of private schools to be a negative development.