Growing Financial Hardships of State Universities

Public or state-run universities throughout the country are facing serious problems in management of their finances. It is becoming increasingly difficult for a large majority of them to discharge their committed liabilities particularly the payment of salaries and pensions on time. Some of them resort to over-drafting, borrowing, or premature withdrawals of fixed deposit receipts to make routine payments. Financial pendency is growing due to an unusual delay in payment of normal allowances and retirement benefits—mainly gratuity and leave encashment. The number of court cases has been piling up because of not honouring the payment schedules and admissibility of allowances announced by governments from time to time. The financial position of some universities is so precarious that even a normal delay in release of grants disturbs the financial equilibrium for a longer period. The persistence of such a state of affairs not only distorts the academic priorities but also compromises the societal position and standing of universities. The university administration instead of focusing on qualitative aspects of educational products remains preoccupied with money matters just to keep the wheels of finance moving. This has eroded their functional autonomy and constitutional mandate.

The higher education system in the country changed drastically under new economic dispensation. In addition to central universities, many private universities and other higher education institutions have emerged particularly in professional, managerial, and technical education. However, state universities remain central in the entire structure of higher education because in addition to large-scale on-campus enrolment they grant affiliation and thereby administer and control a large network of colleges in their respective jurisdictions. The determination, standardisation, and upgradation of academic standards along with conducting examinations for affiliated colleges, granting degrees, and maintaining recruitment standards remains an area of huge responsibility of an affiliated state university. In contrast to central universities, these universities are dependent on the state government for developing and maintenance of grants. The share of state universities in overall allocations by the University Grants Commission (UGC) remained on the lower side. For example, during 2015–16, out of total plan grants of UGC (₹4,003.31 crore), the state universities got ₹648.34 crore (17.13%) as compared to ₹1,911.94 crore (50.52%) allocated to central universities. Similarly, in case of non-plan grants of ₹6,066.47 crore, the respective shares were as follows: state universities ₹191.19 crore (3.14%) and central universities ₹3,872.76 crore (63.54%) (UGC 2015–16: 49–50). Infrastructure support from the UGC for creation of labs, special purpose hostels, equipments, sports facilities, computers, financial assistance to specific departments, etc, is critical but remains low as it accounts for a very small proportion of the overall expenditure of such universities on a yearly basis. During grade revision, UGC has so far normally shared the financial burden of enhanced pay of faculty to the extent of 80% for the initial five years. Various national- and state-level bodies also provide limited number of scholarships to meritorious and weaker section students for pursuing higher and research degrees. But, all such measures, programmes, and schemes did not add financial resources directly to salary budgets of state universities.