Tuesday, June 18, 2013

UGC to stop funding management departments of universities

The University Grants Commission (UGC) has said it will immediately stop funding the management departments of universities plan to start or upgrade their facilities. In a notice this month, posted on its website, the regulator has asked varsities to settle their grant accounts and dues incurred up to 31 May in this regard.

The UGC had started a scheme of development assistance to management departments in 2007, when there were 1,150 of them in the country, official data show, a number that has swelled to 3,700 in 2012. The move might crimp the supply of management graduates in the job market but is expected to have little impact as India’s growth has slowed to 5% in the year ended March from 9.3% in 2007-08.

The tough economic environment has hit B-schools hard in the past few years. Many top institutions, including the premier Indian Institutes of Management, have struggled to find jobs for all graduates this year because many firms have shrunk hiring plans, Mint reported on 15 March.

The university regulator took the decision because of three reasons — not to allow more management schools to mushroom, stop the trend of new colleges and institutes with management departments taking affiliation from universities after the Supreme Court said in April that B-schools with university affiliation need not take any other approval, and to better manage its finances, according to two government officials aware of the development. Both declined to be named.

The UGC used to give between Rs. 5 million and Rs. 7 million each to the management departments of at least 300 universities every year as recurring cost other than a one-time grant of nearly Rs. 5 million. “The purpose for which this plan was floated seems to have been achieved. In 2013, management education is on a different platform than what it was in 2007,” said one of the government officials.

“Instead of looking at all B-schools with suspicion, higher education regulators need to take action against those that are violating norms. There is clearly a case of a huge number of management institutes growing up in the last few years and it’s important to control it. We should not create a situation where the supply overtakes demand,” said H. Chaturvedi, alternate president of Education Promotion Society of India, and Director, Birla Institute of Management and Technology.

Source: Mint, June 18, 2013

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